Research reveals that more than half of tenants who purchased their first home in September are now facing mortgage payments that exceed the rent they previously paid. This marks a shift from before 2022, when buying a home typically led to immediate monthly savings.
An analysis by Hamptons, using Connells Group data, found that 56% of these buyers paid more after their purchase. This proportion is the highest recorded in at least a decade, with fewer than half facing an increase in monthly payments as recently as July.
Aneisha Beveridge, head of research at Hamptons, noted that higher mortgage rates have reversed the financial equation for tenants. She stated that while saving a deposit was challenging when interest rates were low, buying often resulted in an immediate reduction in monthly housing costs.
The research also indicated that first-time buyers whose mortgage payments were higher than their previous rent had an average deposit of 9%. In contrast, those who paid less after buying had an average deposit of 17%. Older buyers in their 40s were also more likely to face higher monthly payments, partly attributed to choosing larger homes and shorter mortgage terms.
Meanwhile, newly agreed rents across Great Britain saw annual growth accelerate for the tenth consecutive month, reaching 2.7% in September. This is the fastest pace since November 2024, with the average monthly rent standing at £1,433.