The housing market is causing increasing frustration in that there are so many who don’t meet the criteria to qualify for a mortgage so are forced to enter the rental market which is costing them a small fortune.
According to recent research from Zoopla.co.uk, the property website, tenants are now paying an average of 14% more by renting when compared to those with a mortgage. To break that down, by renting a 2 bedroom property the tenant is paying out an extra £987 per year than if they had an interest only mortgage on the same kind of property. It also found that compared to a year ago, mortgages are now cheaper in 86% of the UK compared to 84%.
There is some good news for renters, however, as Zoopla have found 5 cities in the UK where it is cheaper to rent than buy. Laurence Hall from Zoopla.co.uk has said that generally speaking it is more cost effective to have a mortgage than to rent, especially in the north which currently has a big gap between the cost of buying and renting. With that in mind, these are the 5 cities where renting is cheaper.
Swansea has an average monthly rent of £672. The average asking price of a property is £184, 658 so by renting you save 12.7%
Bournemouth has an average monthly rent of £789 and as the average asking price of a property is £207,594 so renters save 8.8%
In Stockport the average monthly rent is £559 and with the average asking price being £141,820 the rental saving is 5.4%
Renters in Dundee pay an average of £533 per month and the asking price is £130,471 on average giving renters a saving of 2%
The average monthly rent in Edinburgh is currently £711 per month and with the average asking price being £173,438 a renter will save 1.6%.