Even in London, buying property is now cheaper than renting it on average.
Falling prices and rising demand have made it cheaper to buy than rent property in 45 of Britain’s 50 largest towns and cities. It is now an average 13% more expensive to rent than own, according to research from property search website Zoopla.co.uk.
The results were based on a comparison of asking prices and rents based on an interest-only mortgage of 5% per annum. Even in London (where the average asking price for a 2-bedroom flat is over GBP 400,000), buying is still cheaper than renting. Here by an average 28%.
Zoopla’s Nicholas Leeming commented:
With house prices down, low interest rates and sky high demand in the private rental sector, buying has never been a better option for those able to secure a mortgage. And with owners reducing prices further in order to achieve a sale before Christmas, there may well not have been a better time to buy in recent times.
In a previous interview, Erica Evans of UK property consultancy Expatfindaproperty.com told Expat Wealth that property in popular areas of cities like London can often be a solid liquid investment. “Good properties in popular parts of London will always sell,” she said, “which can be a useful insurance in a slow market if a client needs to liquidate an asset quickly.”