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Potential first time buyers would be £1bn better off buying a property than continuing to rent according to a new study from Abbey Mortgages.

According to the bank's research, 1.61 million Britons said that they were looking to buy in areas of the country, other than London, and based on today's prices these people would save £624 each – or a collective £1bn over the next 12 months by doing so.

These potential first-time buyers spend £434 on rent, on average, while those buying a property for the first time with a 25% deposit would currently see a monthly mortgage bill of £382 – an average saving of £52 per month. Across the country, the research into typical first-time buyer flats and terraced properties found that in the last 12 months, average prices have decreased by 9%, to £92,861. This means a first-time buyer will need an average deposit of £23,215 if they want to buy a property with a 25% deposit.

Interestingly, in December 2008, Abbey Mortgages found buying a property to be an average of just £51 cheaper than renting each month – so things have improved significantly for those looking to get onto the housing ladder.

Nici Audhlam-Gardiner, director of Abbey Mortgages says: "Our latest research shows there is hope for first-time buyers trying to buy their first home. It's now cheaper in all bar one of the regions to buy rather than rent and shows that saving for that all important deposit is so worthwhile too."

SOURCE: Abbey, 09/10/09

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