The latest rates rise has made it cheaper to rent a home than buy one.
Until last week it was on average £40 a month cheaper to pay for a mortgage with a 10% deposit than it was to rent the same home. Last week’s decision by the Bank of England has turned this on its head. Hamptons estate agents found that it is now up to £98 a month cheaper to rent than buy.
Lenders have been steadily increasing mortgage rates, with the rate on the average two-year fixed mortgage rising to 3.25% this month, compared with 2.34% in December, according to Moneyfacts, the financial data company.
There are stark regional differences though, with it generally being cheaper to rent than buy further south, while further north it tends to be cheaper to buy than rent. In the east of England it is now £98 a month cheaper to rent than buy while in Scotland it is £176 a month more expensive to rent.
On average it is now just £1 a month cheaper to rent.
