Buyers better off than renters by £200k, says Barclays

Buyers of UK property will see enormous financial benefits over their lifetime, according to new research from Barclays.

It revealed that the cost of owning a home rather than staying in rental homes is £194,000 less over a person's adult life, without taking into account the value of the building when it comes to sell or pass on.

Barclays said that the total cost of mortgage repayments, maintenance and over home-owning costs comes to £429,000 over 50 years. However, across the same period renting a property would set the tenant back £623,000.

The largest difference between buying and renting was seen in London. The average house price was found to be £343,522, with year one rent costing £17,520. This leads to a lifetime cash saving from owning of £396,049.

Andy Gray, head of mortgages at Barclays, said: "The cost of stepping on or moving up the housing ladder can be a big barrier for many, but the long term benefits hugely exceed the initial expense. Not only will you save money by becoming an owner occupier, but you will also own a substantial asset once your mortgage is paid off, providing financial security for your old age."

He added that those who choose to rent permanently will have to pay their landlord out of their pension income, while owner-occupiers will enjoy minimal housing costs.

Barclays has also created a new mortgage scheme called Helpful Start which features a Family Affordability Plan.

This gives parents a helping hand when it comes to comes to affording a loan, without them being on the property deeds. It is also available across all of its mortgage rates, including NewBuy.

"Many parents have already realised the return from buying their homes and want to give their children this important step towards independence, but they cannot afford to provide them with the deposit to buy their first home or trade up," Mr Gray said.

He advised that the Barclays' Family Affordability Plan lets parent and child pool resources and secure a larger loan which will help them get on or move up the UK property ladder.