"First-time buyers are saving an average of £27,000 over their mortgage term compared to those who are renting, according to Halifax research."
Its data shows that the average cost including mortgage payments of buying a three-bed home in the UK was £679 a month in December 2017, compared to the average monthly rent of £754 for the same property type.
The gap between the cost of buying and renting is now at its highest in four years, up 44% from last year’s £623 saving to £900 a year.
Londoners are seeing the greatest annual savings at £2,191 compared to £589 in Yorkshire & the Humber.
However, as a percentage, the biggest savings are made in Scotland and the South West of England, where the cost of buying is 17% lower than renting. The financial gain is most humble in the South East of England, where the cost of buying is 8% lower than renting.
The average monthly cost of buying has dropped 22% (£192) since 2008, while rental payments have jumped by the same amount (22% or £138).
Russell Galley, managing director at Halifax, said: “The gap between buying and renting has widened significantly, primarily driven by a reduction in mortgage rates and a more competitive market pushing down monthly payments. Meanwhile, the cost of rent, household maintenance and average deposits have remained broadly flat.
“Despite having to put down a sizeable deposit up front, homeowners are overall better off than renters in all parts of the UK. But those who are unable to get onto the property ladder because they can’t raise enough cash are paying more by renting.
“The good news is that record numbers of first-time buyers are still taking their first step on to the ladder and helping to bridge this gap thanks to a continued low-rate environment and government schemes including Help to Buy.”
