Owning a home still cheaper than renting, but gap shrinking
The gap between the cost of buying and renting is down 59 per cent, hitting its lowest level in nine years, data from Halifax shows.
In 2017 buyers were saving an average £900 a year compared to renters but this saving was down to £366 last year, according to the latest figures released by the lender.
In December 2018 housing costs, including a mortgage on a three-bed home in the UK, were £729 a month, compared to the average monthly rent of £759 for the same property type.
Buying in recent years has meant lower monthly costs than renting across the UK but the latest picture shows an uneven snakes and ladders effect.
Outside of London, Scottish buyers have the highest average annual savings of 20 per cent standing at £1,574 compared to renting. In contrast, in Yorkshire the cost of buying is only five per cent lower than renting, saving £361.
Regionally, buyers are better off than renters in Wales with annual savings of more than £2,000, while in Northern Ireland mortgage payers are only saving £382 annually.
New buy-to-let mortgages have slowed down and first-time buyers are now driving the number of house purchases with a mortgage, the lender added.
Russell Galley, managing director at Halifax, said the gap between buying and renting is narrowing, primarily driven by reduced first-time buyer prices deposits in some regions and continuing house price growth, meaning buyers are paying more on their mortgages.
He added: “With more products available for borrowers, these factors combined have pushed up the price of buying quicker than the price of renting. Meanwhile, the cost of rent, household maintenance and average deposits have remained broadly flat.”