Cost of renting property worsens.

According to property website Zoopla, renting a home now costs 10.5% more on average than servicing a mortgage.  They reveal that renting a home is now a more expensive option than owning in 80% of Britain's towns and cities and the cost difference has been resigin steadily since the middle of 2010 when renting was 8.7% more expensive.

The new research looks at the asking prices of two-bedroom flats currently for sale and to rent in the 50 largest cities and towns around the country and mortgage payments are calculated assuming an interest-only mortgage at 5% pa to provide an effective comparison to renting.

Several factors are considered to be behind the increased cost of renting.  The severe shortage of mortgages has kept many potential first-time buyers in the rental market resulting in high tenant demand, while the combination of stagnant house prices and low interest rates has reduced the monthly cost of home ownership.

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