Mortgages for first time buyers now cheaper than renting
The sharp increase in rental prices over the past few years has made buying a home, on average, 15% cheaper than renting, reversing a recent trend. Currently, the average rent across England and Wales is £1,250 per month, while the average mortgage repayment stands at £1,066.
This calculation assumes first-time buyers with a 20% deposit, purchasing a typical first-time buyer property priced at £240,000, with a 25-year mortgage term and a current 5-year fixed rate of 4.4%.
This shift is further supported by falling mortgage rates. The monthly mortgage payment for the average first-time buyer home peaked in mid-2023 but has since decreased by 10%.
While this trend offers welcome relief for first-time buyers, challenges related to affordability persist. One of the biggest obstacles remains saving for a deposit— a 20% deposit on an average-priced first-time buyer home amounts to £48,000. Source: Dataloft by PriceHubble (https://inform.dataloft.co.uk/), Land Registry. March 2025.
What about first time buyers in Harlow?
Sales & Marketing director Geoff Flewers says: ” I was extremely interested when I saw this data from Dataloft by PriceHubble. However, I wanted to know what it is currently like in Harlow. Therefore, I have looked at a slightly different set of figures”.
He continued: “Trusted mortgage brokers have told me that whilst 4.4% mortgages are available, it would be prudent to look at 30 year mortgages at 4.7% as these are much easier for first time buyers to qualify for. We also factored in various deposits to get a more realistic overview”.
According to Dataloft by PriceHubble, the average price of a Harlow property is currently £318,498.
A mortgage on a £318,498 property with a 20% deposit over 30 years at 4.7% would be £1,322 per month.
The average rental price of a Harlow property is currently £1,580 per month.
Therefore, in Harlow it would be £258 per month cheaper to buy an average priced property as it would to rent it!
Differences in Mortgage against rent by property type
FLATS
Traditionally a high proportion of first time buyers buy flats.
The average price for flats in Harlow is £196,149
A mortgage on a £196,149 property with a 20% deposit over 30 years at 4.7% would be £814 per month.
The average rental price of a Harlow flat is currently £1,095 per month.
Therefore, in Harlow it would be £281 per month cheaper to buy an average priced flat as it would to rent it!
TERRACED HOUSES
The average price for terraced properties in Harlow is £323,183
A mortgage on a £323,183 property with a 20% deposit over 30 years at 4.7% would be £1,341 per month.
The average rental price of a Harlow terraced house is currently £1,543 per month.
Therefore, in Harlow it would be £202 per month cheaper to buy an average priced terraced house as it would to rent it!
SEMI DETACHED
The average price for semi detached property in Harlow is £402,823
A mortgage on a £402,823 property with a 20% deposit over 30 years at 4.7% would be £1672 per month.
The average rental price of a Harlow semi detached property is currently £1,771 per month.
Therefore, in Harlow it would be £99 per month cheaper to buy an average priced semi detached property as it would to rent it!
DETACHED PROPERTY
The average price for detached properties in Harlow is £527,503
A mortgage on a £527,503 property with a 20% deposit over 30 years at 4.7% would be £2189 per month.
The average rental price of a Harlow flat is currently £1,832 per month.
Therefore, in Harlow it would be £357 per month more expensive to buy an average detached property as it would to rent it!
Conclusion
Mortgages for first time buyers now cheaper than renting
In Harlow it is cheaper to buy flats, terraced houses and semi detached properties than renting them.
With detached properties it is still cheaper to rent.