Top 10 locations where buying beats renting Rank 1 2 3 4 5 6 7 8 9
Location
Milton Keynes York
Preston
Northampton Birmingham Walsall London Bradford Swindon
10 Warrington
Location Swansea Oldham
£2,442 £482 £587 £571
Locations where renting rules over buying Rank 1 2 3 4 5 6 7 8
Cambridge
Bournemouth Liverpool Aberdeen
Huddersfield Plymouth
£1,033 £757 £598 £846 £495 £601
Avg. Monthly Rent* £676 £497
Avg. Monthly Rent* £770 £856 £550 £589 £701 £497
Avg. Asking Price* £133,141 £154,176 £99,838 £107,314 £128,170 £91,098 £452,387 £89,923
£109,912 £106,987
Avg. Asking Price* £177,100 £126,447 £260,029 £189,280 £145,581 £205,618 £120,049 £144,862
Source:
Zoopla.co.uk * Based on 2 bedroom flats on the market for sale/rent in February 2012 ** % variance between average monthly rent and average monthly cost of 5% p.a. interest-only mortgage
Countrywide has predicted with the scheme’s help new build will bring in £1.5bn this year and £8.5bn by the end of 2012. A study from Rightmove meanwhile revealed that it expected two in every five first-time buyer to be more likely to purchase as a result of NewBuy.
And other avenues also exist to help potential buyers to get their deposit together. Steve Lowe, managing director at equity release provider Partnership, looks towards possibly one of the biggest lenders in the UK currently, the bank of Mum and Dad. “We are seeing equity release being increasingly used by parents and
www.mortgageintroducer.com
grandparents to help their kids and grandkids get on the housing ladder,” says Lowe. “It’s a trend that’s been going up in recent years. Just as we’ve seen relatives to help fund increasing education costs, we’ve seen the same happen in raising first-time deposits.” Professional whole-of-market knowledge on equity release, the NewBuy scheme and niche building societies are cards which neither a borrower nor a lender has, but a broker does.
AN IMPROBABLE FICTION With all the deposit raising and low deposit schemes out there, a broker
should still ask himself: “What do I do if Britain becomes a nation of renters?” The trustiest of tools within a broker’s toolkit is his selection of mortgages. Each tailored for a specific market and when it comes to tucking into the private rental sector, the broker calls upon the buy-to-let mortgage. The demand for rental
accommodation is buoyant, figures from Paragon Mortgages show. Over the past five quarters, 45% of landlords declared they have seen tenant demand either growing or booming. This is far higher than the previous five-month average.
Lenders have noticed this MORTGAGE INTRODUCER JANUARY 2012 31 MORTGAGE INTRODUCER APRIL 2012
Rental Discount** 38.8% 33.2% 32.3% 31.7% 31.3% 30.9% 29.6% 28.5% 28.2% 28.0%
Rental Discount** -8.4% -5.6% -4.6% -4.0% -1.4% -1.2% -0.9% -0.4%
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