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Buying cheaper than renting home
The monthly cost of buying your own home is now more than £130 a month cheaper than renting, research has revealed.
Rising rent payments combined with lower property prices and mortgage rates now mean that property buyers pay 18% - or £132 - a month less on average than those who rent, according to Halifax.
The lender said that average monthly costs for buyers of a typical three-bedroom house - including mortgage payments and household maintenance and repair costs - were £600 in June, against £732 in rent paid on the same type of property.
Rent payments have risen steadily in the past few years, up 5% in the past year alone, while buying costs have fallen 3%. Four years ago, the average cost of buying and owning a home cost 45% - or £324 - more than the average monthly rent paid.
But despite the improvements in affordability, the number of new buyers in the market has fallen by a dramatic 33% in the last four years as lenders are demanding increasingly high deposits.
The average loan-to-value now stands at around a quarter of the property price, at £40,526.
Martin Ellis, housing economist at Halifax, said: "Those getting on the housing ladder still face challenges, most notably in getting a deposit, and this challenge, along with the considerable uncertainty regarding the economic outlook, is still contributing to subdued housing demand. However, it is worth noting that once homebuyers are on the first rung, their monthly costs are notably lower."
The research shows that owning a home was more affordable than renting in all 12 regions across the UK.
In London, the typical homebuyer pays 14%, or £177, a month less than the average renter. The difference is the smallest in the East Midlands, where a homeowner pays 2% less a month than a renter.
A record low bank base rate of 0.5% since the financial crisis struck has seen the average mortgage interest payment fall to 3.82% in June from 5.91% in June 2008. The typical UK house price has fallen by a tenth over the same period.