As average rental prices surpass mortgage repayments, potential first-time buyers would be able to save themselves an average of £2,268 per year by purchasing a property rather than renting, according to research undertaken by Santander.
How much are homeowners in Scotland saving on average compared to renting?
Even though renting has historically been seen as the cheaper option – due to consistently high property prices coupled with a common assumption that a mortgage places a considerable financial burden upon a first-time buyer – this recent study has demonstrated the opposite. With rental costs in Scotland exceeding mortgage payments by an average of £134 per month, a homeowner in Scotland could be saving, on average, a substantial sum of £1608 per year.
This reversal in costs has occurred throughout the UK due to mortgage rates dropping substantially in response to inflation falling, alongside steadily increasing rental prices. This switch is most visible in London, with the average monthly saving almost £300 per month.
Although purchasing a property as a first-time buyer requires a weighty upfront cost, the long-term benefits of the significant financial investment seem apparent, with noteworthy savings to be made over renting, together with owning a valuable asset once the mortgage is paid off.
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