Buying a home is 'more expensive than renting'

People who are on the fence when it comes to buying their first piece of UK property have been given advice on the effort by a UK property expert. The main issue when it comes to the decision between buying and renting surrounds money saving, but first timers could find that it is in fact more expensive to purchase properties for sale.

This is the opinion of Stuart Law, chief executive officer of Assetz, who said that the fact that monthly interest rates on mortgage repayments are always falling means that there could be more financial benefit to buying a house, but only if 100 per cent mortgages are in place.

If mortgage payments are lower than 12 yearly expenditures to a landlord, then it is hugely beneficial to be purchasing a home, as buyers will have something in the long run to show for their money.

The only issue which will then exist will surround the deposit, with many people now seeing the cost of this one-off payment reaching as high as 20 or 25 per cent of the price of the house. 

Unfortunately, this means that even with a monthly payment of just £100, a deposit of around £30,000 will make this a much more expensive outlay than simply giving a landlord £700 every month.

Mr Law said that there is currently some positivity for people who are looking to get onto the property ladder, largely due to the market performing well in the last few months; a trend which could be set to continue in months to come.

"The market is recovering and all of the indicators are pointing upwards in terms of developer site visits by prospective buyers, [and improvement in the number of] mortgage transaction levels being made. Everything is gradually [moving] in the right direction."

He also went on to add that he believes there is enough assistance from the government for buyers at the current time. However, he said this may need to be upped once the market shows further signs of recovery.