The average British adult will pay out more than £63,000 in rent before they get onto the property ladder and become homeowners, according to a study from home builder Keepmoat Homes.
Their new research found that people who have bought their first home within the last five years typically paid £625 every month in rent to their landlords and that it takes renters almost eight and a half years before they finally save up enough to buy their own home and become homeowners, spending a total of £63,225 rent in the process.
This figure is the equivalent of more than a quarter of the value of the average UK home, which is now worth £228,903, says Keepmoat Homes.
The real cost of renting
Tim Beale, chief executive officer at Keepmoat Homes, commented: “For many people, renting is an important first step towards home independence. It offers benefits like flexibility, allowing you to test different areas and types of home before you commit to buying somewhere.”
He continued: “However, this research highlights the considerable cost of renting and therefore it isn’t surprising to see that for over half of people asked, they say they feel as if the dream of homeownership will never be possible.”
Mr Beale added: “In reality, homeownership can cost less than your rent. For example, with our average selling price of £156,000, the standard monthly mortgage repayments would make you approximately £100 a month better off than paying the typical £625 rent.”
Impossible to save while renting
The study also found that of those who had bought their first home in the last five years, or who are still renting, three quarters believe it is ‘impossible’ to save for a home while renting.
Of those who have bought a home, they spent almost five years saving before putting down an average deposit worth £24,033 on their property, which is more than 80 per cent of the average British adult’s salary.
However, about 40 per cent of respondents were able to lean on their parents for financial support when it came to their deposit, while a fifth relied on an inheritance and a quarter ended up moving back in with their parents to save on rent. Another 24 per cent considered this idea but were able to avoid it.
The research also found that 18 per cent of renters have taken on two jobs in order to save for a deposit while paying out monthly to a landlord. At least one in four of them have even skipped holidays, while a third have cut back on luxuries like magazines, flowers in the home and TV and movie costs.
Additionally, 30 per cent said that they started taking a packed lunch to work and 18 per cent tried to do all their shopping in the reduced section of the supermarket, rather than paying full price, according to Keepmoat Homes.
Three quarters of those who participated in the poll also believe something needs to be done when it comes to the cost of renting, to help those trying to save to become homeowners.