Mortgage cheaper than rent?

Obviously it’s cheaper to buy.

Even if the price is the same at a starting point. The house gets cheaper every year because you locked in the price and the rent gets more expensive as inflation and everything gets more expensive.

Obviously not true if you factor in stamp duty and move every few years.

But in general it is true. Up until now our house has been cheaper than rent (might change my mind when we renew at current interest rates!). And we have been able to build equity in ways we never could have renting.

Ie. We have spent c. 100k on mortgage and deposit in the past 9 years. Our equity is 300k.

To add to this- I’ve assumed you would buy the flat for sale at full asking price- but it’s been on the market a while and so I’d presume you’d actually end up paying less for the flat, and therefore even less per month for the mortgage compared to renting the other flat in the same building.

We have just put an offer in to buy a house - we have rented for 15 years and saved a meagre 5% deposit! However, our rent is 1400 per month. It started at 1100 and has gone up every year for the last 4 years following the RPI index as a percentage indicator so the first year it went up by 12%. It was awful. However, our mortgage in principle says our mortgage rate and if we have calculated it right, our new home will cost us about 957 a month. The home is the same size in the same town in the north east.

For us, it absolutely is true. No big deposit skewing our figures. Just a mum and dad in their 30s (just about) no family money and no additional help x

You’re completely loopy

If you have been a landlord for 21 years and haven't been pulling equity out of the house when you remortgaged, surely your rent from the house you purchased 21 years ago in 2005 more than covers your mortgage

The OP is totally confused. I cannot work out whether they are a clueless landlord or a annoyed tenant.

They also arent answering any of the sensible questions posters are asking.

Could you imagine dealing with someome like this in life?

You cannot compare rental to mortgage.

1. What if the landlord brought the house outright
2. What if they put down a hefty deposit
3. Rent is minus all the costs like letting agents fee, maintenance contracts for utilities
4. A risk to landlords that they will get bad tenants with little recourse in getting them out in a timly fashion or getting their money back for damage cause.

My dd just bought a flat in Watford and mortgage is definitely cheaper than rent. Also you eventually pay off a mortgage, we paid our mortgage about 3 or 4 years ago,so only have upkeep and utilities to pay.

Which is completely irrelevant. HTH.

Why are you wasting everyone's time?

wish I hadn't bothered with my post now as you're not interested in a genuine conversation or looking to learn anything.

you'll be sending virtual business cards next

Well I guess it depends on many factors, but for us no. We were paying £1400 rent on a two bed bungalow and bought in December a two bed bungalow and mortgage is £2300.

Look up house/flat prices in the more deprived areas of Scotland and you'll find loads of properties less than £100K, our local Housing Associations are charging around £500 per month rent for the smallest properties.

Even if you don't quite find it cheaper to buy now, give it 10 years of consistent rent increases and you'll be quids in.

You still haven't answered my question.

Obviously rent will always be higher. Landlords if they have a mortgage on the house have to pay it out of that rent as well as maintenance. With a mortgage you will eventually own your house and hopefully won’t have to worry making payments to keep a roof over your head once you retire.

You haven't answered anyone's questions, even when comparing mortgage and rental cost at 100% house value you seem to ignore anything long term. Or that if you were on interest only mortgage and rented out the house you would also likely make a profit. I'm not anti landlord at all, but if you would always pay out more on a mortgage than you would make in rental payments in the long term, no one would ever become a landlord. You just sometimes have to accept you won't make an instant profit which is similar to a lot of start up businesses

What is the purpose of this thread?

Is it that you think tenants are clearly so financially deprived that they couldn't possibly pay higher rent than they'd pay on a mortgage?

My mortgage is £600 a month, to rent out property would cost us £1500 a month…that extra £900 is a lot of find each month.

Surely it depends where you live.

Houses on my terrace street are about £110k but rents are in excess of £850. One house has been split in 2 and is advertised at a combine £1600. So a mortgage would be cheaper.

Yes. My house would be 1800 a month to rent. I know because I looked into it recently. My mortgage has never been more than 500.

We pay around £1.2k on our mortgage for a house that is worth around £800k (purchase cost 13 years ago + extension costs = 600k).

The rental value would be £3k+ per month.

So yes the mortgage is way cheaper than renting this property would be.

Plus we end up with a big asset.

When people are answering your question they are saying that it's more affordable monthly to own and pay a mortgage than to rent. Ie. It is usually cheaper monthly to be paying a mortgage than to pay rent on a similar property. So for an average person monthly outgoings on accomodation will be less for a mortgage than renting.

Long term whether something is cheaper than something else is almost impossible to calculate surely as depends on how much deposit was paid, mortgage rates, the term of the mortgage and how much the house prices rise over the years etc.

I think it depends when and where you buy. My mortgage is £600 because I bought the place 18 years ago. To buy it now at the market rate (assuming a 10% deposit) mortgage would be around £1400 a month which is exactly what the flats rent for. Or if you've got higher deposit or equity moving from another property then a mortgage would definitely be cheaper.