It pays to buy in Aberdeen but rent in London
Aberdeen is the most cost-effective town in the UK to buy a property, rather than rent, according to new research.
London, on the other hand, is currently the most renter-friendly city in Britain. Buying in London with a 10% deposit takes 18 years to become more cost-effective than renting, a study by property website Zoopla.co.uk reveals.
After seven years, a London renter would typically be £82,412 better off than a buyer with a 10% deposit on an equivalent property. These figures are based on a conservative estimate of 4% annual house price growth in London.
Meanwhile, in Aberdeen, it takes buyers with a 10% deposit just one year to be better off than those who rent. And buyers in Aberdeen will be £99,000 better off compared to renters after seven years.
Dundee, Glasgow, Edinburgh and Cambridge also came out better for buyers rather than those who rent.
The latest Zoopla 'rent versus buy' analysis revealed that Bournemouth is the second most renter-friendly town in the UK. It would take 22 years for a buyer with a 10% deposit to be better off than a renter, as average asking prices are £380,206 while average rents are £1,024.
Huddersfield, Bedford and Swansea also came out better for tenants rather than buyers.
Lawrence Hall of Zoopla.co.uk said: "Despite taking longer to be better off financially, London remains the holy grail in terms of property investment. It is much more buyer-friendly outside the capital but with rising average prices and low savings rates, accumulating a deposit has become increasingly difficult."
He added: "It is important to remember that whilst renters may be better off in the short to medium term in some areas of the country, buyers are making a long-term investment. With most buyers opting for mortgage terms of 25 years, over the long term, buyers are likely to be better off compared to those who choose to rent."