LETTING & ESTATE AGENT

Mortgages could be more expensive than rent bills, warning

Mortgages could be more expensive than rent bills, warning

First-time buyers who take out high loan-to-value mortgages will be paying more per month than if they were renting.

New research from Hamptons International compared the monthly repayment costs of a 95% LTV mortgage on a two-bedroom house with the cost of renting.

It found that renting was cheaper in almost every region of England and Wales. The only exceptions were the north-west and north-east.

Research director Fionnuala Earley said consumers had difficult choices to make: “On the one hand improving credit conditions and government help have made buying more accessible.

“On the other, relative to buying, renting is still cheaper for many, particularly young, people.”

The research underlines doubts about the 95% Help to Buy mortgages, which have high interest rates. However, rents are also on the rise – see next story.