Cheaper to buy than rent in Colindale
New research from Fairview New Homes has revealed that not only is it cheaper to buy a new three bedroom apartment in Colindale than it is to rent a similar property, relative to income, it is as cheap to buy now as it has been for 15 years.
Fairview’s research shows that three bedroom apartments in its Pulse development, adjacent to the Underground station, are commanding rents of between £1925 and £2000 per month*. For those able to raise a deposit of 20%, a similar brand new home can be bought with a monthly mortgage commitment of just £1304.**
Rents in Colindale have continued to rise along with the wider national trend. Figures last month from estate agent group, LSL, showed national rents to have risen by 2.9% in the last year with rents in the South East rising even faster.
The average rent paid by private tenants in England and Wales reached a new record high in July, of £725 a month, whilst the average rent in London is now some £1057.
Whilst renting is becoming an increasingly expensive option, buying a new home is as cheap, relative to income, as it has been for many years. Research from Halifax last month revealed that mortgage payments for new borrowers, relative to earnings, are at their lowest level since 1997 with typical payments for new loans representing just over a quarter (26 per cent) of take-home pay.
In London specifically, where house prices have remained relatively strong due to overseas buyer demand, potential payments for new borrowers dropped from 56 per cent of earnings five years ago to around 35 per cent now according to the study.
Pulse is attracting significant interest from home buyers and investors. It appeals to a wide range of buyers with the varied home styles available attracting first time buyers, professionals working in the City, young families and older residents looking to downsize. Half of the apartments have already been sold and independent residential property research specialist, Molior London, quotes the Pulse apartments as the fastest selling new homes in London.
Pulse offers investors a choice of house and apartments ranging from a simple studio through to a 1298sq ft four bedroom townhouse. The specifications of each home have been carefully designed to combine elegant details with contemporary and stylish living. The high quality finishes include fitted carpets in all living areas and ceramic floor tiles in bathrooms, stylish kitchens, energy-saving appliances, beautifully appointed bathrooms and serene bedrooms.
For homebuyers fro whom finding a larger deposit is increasingly difficult, apartments at Pulse are available through the government’s mortgage guarantee scheme, New Buy. NewBuy is designed to help overcome the deposit gap faced by many new home-buyers. It is aimed at both first-time buyers and those who already own a home, who only have funds for a 5-10% deposit. For buyers meeting their qualifying criteria, the lenders participating in the scheme will provide a 90-95% loan-to-value mortgage, which is guaranteed by the government. Pulse is one of the very first developments in the country to offer NewBuy funding through a “challenger” bank. Aldermore was set up following the banking crisis to offer an alternative to the large clearing banks and building societies and offers mortgages at Pulse of up to 95% LTV at an APR of 5.48%. Repayments for the three bedroom apartment in this case would be £1549 per month***, still substantially cheaper than renting.
The large three bedroom apartments at Pulse are available for just £315,995 but prices at the development start from just £159,995 and, through the NewBuy scheme, will mean that buyers will only need to find £8,000 for their deposit. Further details about Pulse and the NewBuy mortgage guarantee scheme can be found at fairview.co.uk.
