Buying beats renting in Aberdeen, but it pays to rent in London

  • Buyers in Aberdeen will be £99,000 better off compared to renters after 7 years
  • Dundee, Glasgow, Cambridge and Edinburgh also compelling to buy vs. rent
  • Buying in London with a 10% deposit takes 18 years to become more cost effective than renting
  • Bournemouth, Huddersfield, Bedford and Swansea also make sense to rent not buy

Aberdeen is the most cost-effective town in Britain for buying property compared to renting. Over a typical seven year period, the average property owner in the Scottish town can expect to be £99,040 better off compared to the equivalent renter, according to research from property website

The latest Rent vs. Buy analysis from Zoopla shows that it takes buyers in Aberdeen with a 10% just one year of ownership for buying to become more cost effective than renting. The average property price in Aberdeen is currently £206,060 with average monthly rents at £1,275.

London is currently the most renter-friendly location in Britain. After seven years, a typical London renter would be £82,412 better off than a buyer with a 10% deposit of an equivalent property. It would take 18 years for a London buyer with a 10% deposit to begin to be financially better off compared to the equivalent renter. These calculations are based on a conservative estimate of 4% annual house price growth in the capital.

Bournemouth is the second most renter-friendly town in Britain. With average asking prices of £380,206 and average rents of £1,024 it would take twenty two years for a buyer with a 10% deposit to be better off compared to a renter in an equivalent property. After a seven-year period, a typical renter in Bournemouth would be £30,719 better off than a typical buyer with a 10% deposit.

Lawrence Hall of said: “Despite taking longer to be better off financially, London remains the holy-grail in terms of property investment. It is much more buyer-friendly outside the capital but with rising average prices and low savings rates, accumulating a deposit has become increasingly difficult. It is important to remember that whilst renters may be better off in the short to medium term in some areas of the country, buyers are making a long-term investment. With most buyers opting for mortgage terms of 25 years, over the long term, buyers are likely to be better off compared to those who choose to rent.”

The Zoopla Rent vs. Buy methodology compares all of the costs associated with buying or renting as well as increases in asset or savings value over time. The analysis forecasts the amount of time it will take for buying to become more cost effective than renting across the largest towns and cities in Britain and compares how much buyers or renters are financially better off after the average tenure of a house.





Av. Asking Price


Av. Monthly Rent

Amount buyers are better off after 7 years (10% deposit)

































Milton   Keynes








Source: (February 2014)





Av.   Asking Price


Av.   Monthly Rent

Amount   renters are

better   off after 7 Years

(10%   deposit)





















Source: (February 2014)


Advertised Salaries fall to a 16-month low despite jobs optimism

Adzuna Logo

The average advertised salary across the UK has fallen to a sixteen month low, according to the latest UK Job Market Report from

The average advertised salary has fallen by 4.1% in the past twelve months, to just £32,323 in December 2013. This equals a drop in wages of £2,136 in real terms, and marks the third consecutive month in which advertised salaries have fallen.

Andrew Hunter, co-founder of Adzuna, explains: “The recovery in the jobs market is far from over. The great news is unemployment has fallen at record levels, but wages are still stuck in a post-recession hangover – while the backlog of employees waiting for the right time to change jobs is clearing, salary levels are yet to catch up. Compared with this time last year, there are fewer people fighting it out for each position, but the chances of securing a decent salary have become slimmer.”

Table 1

November 2013

December 2013

Month Change

Annual change

UK Vacancies





Jobseekers per Vacancy





Av. Advertised UK Salary





Salaries across the nation

The salary slide has been felt throughout the country, with annual advertised pay declining in every region aside from Wales during the twelve months to December. The East of England and the West Midlands have borne the brunt of the fall, with the average salary dropping 8.4% and 6.9% respectively in these regions. But Wales has bucked the trend. Salaries in Wales have risen 4.1% over the twelve months to December, reaching an average of £28,121. Salaries in Wales are now at their highest point since August 2012.

Andrew Hunter comments: “The salary picture looks gloomy throughout the country. But some areas are weathering the storm better than others, with Wales leading the way. Initiatives such as Jobs Growth Wales, which has created over 10,000 jobs for young people, are helping to kick-start the regional labour market.[1] As demand for good employees has increased, so has advertised salaries. Wales is further along the curve in this respect than England, Scotland and Northern Ireland.”

Festive season fuels services boom

A few sectors have managed to navigate the salary slump, and witnessed an increase in advertised salary in December.

Salaries in the Hospitality and Catering sector increased 6.6% to £19,234 in the year to December 2013 – the largest increase of any UK sector. The industry also saw a rare monthly increase of 1% from November to December. This follows recent statistics showing that revenues in bars and restaurants increased 5% and 38% respectively over the Christmas period, largely fuelled by corporate hospitality as a result of increased business confidence.[2]

Other sectors to record salary increases in December included Engineering (+5.1%) and the Energy, Oil and Gas sector (+1.5%). In both skilled sectors, a brain drought has led to fewer skilled workers vying for each role and employers have increased salaries as a means to attract talent.[3]

At the opposite end of the spectrum, some of the sectors that have suffered most severely from the salary slump include Healthcare (-3.4%) and Teaching (-1.8%). Public sector cuts have taken a toll on budgets, and salaries have been squeezed as a result.

Andrew Hunter comments: “After years of corporate belt-tightening, the Christmas party season clearly brought some festive cheer to the hospitality sector. Our waistlines may have just about recovered, but the long-term effect on salaries is still being felt.”

Impact of proposed changes to the minimum wage

Adzuna analysis reveals that well over 1 million British employees would be affected if the Government proposals to increase the minimum wage to £7 per hour were to come into effect. Even this move, however, will still leave many Britons well below the living wage across the country.

In addition, recent research estimated that almost two-thirds of hospitality employees earn the national minimum wage,[4] meaning that a significant number in the industry could be in line for a pay rise if the proposed changes were implemented.

Andrew Hunter, co-founder of Adzuna, explains: “For the 1m+ workers affected by this change, the proposed jump in their hourly rate would have a significant impact. But for the remaining majority of our workforce, any improvements are likely to be more gradual. Osborne’s proposals would do nothing to help the squeezed middle, who are still struggling from a cost-of-living crisis caused by inflation.”

Vacancies and competition for jobs

The number of vacancies in December was 11.9% higher than a year ago, with 744,665 positions on offer. This was despite a slight monthly decrease from November, typical of a seasonal slowdown.

Compared to the previous year, competition for jobs fell by almost a third (30%) in December. But compared to the previous month, a slight monthly fall in advertised vacancies meant that competition for jobs increased by 1.3% in December, to 1.61 jobseekers for each advertised vacancy.

Employers have been slower than anticipated to boost workforces in January, demonstrating a delayed recovery from the seasonal recruitment slump. Adzuna data showed that advertised vacancies in late January fell almost 20,000 vacancies short of the record levels seen in November.

A strong North-South divide… but signs of improvement

A prominent North-South divide persists in the labour market. Nine of the top ten cities to find a job were in the South of the UK, and seven of the worst ten cities to find a job still based in the North. Cambridge was the best city in the UK to find a job in December, with just 0.22 jobseekers per vacancy.  It was almost 100 times more difficult to get a job in Salford, the second most difficult city in the UK to find a job (with 20.54 jobseekers per vacancy), compared to Cambridge, the easiest place in the UK to find a job (with 0.22 jobseekers per vacancy).

There are, however, a few signs that the situation is improving for some industrial pockets in the North. Wolverhampton may be the seventh worst city in the UK to find a job, but competition for vacancies in the city is falling rapidly, and has dropped 38% over the last six months, bolstered by a strong service sector, and growing manufacturing and engineering industries.

Likewise, in Sunderland – the fourth worst city to find a job in the UK, and home to the UK’s vehicle production industry – competition for jobs has halved since July 2013.

Andrew Hunter comments: “Several local industry hubs are fighting back. Competition for jobs in both Sunderland and Wolverhampton has eased dramatically since July, as more vacancies have opened up.  Wolverhampton has the added bonus of having growing manufacturing and engineering industries, where business confidence is encouraging investment and boosting salaries.”

adzuna map jan

[1] Welsh government scheme which started in April 2012

[2] D&D/Living Ventures trading statement, December 2013

[3] Professor John Perkins’ Review of Engineering Skills, November 2013

[4] Resolution Foundation study

News Headlines: Wednesday 15th January


Yesterday saw the announcement that inflation fell to the government target level of 2% in the last month, for the first time in four years. Inflation came in 0.1% lower than in November 2013, helped by the falling cost of recreational goods and services. But slower inflation was partially offset by an increase in motor fuel process, according to the ONS. (Guardian p.20 Metro p.46)

Personal Finance

Research from housing charity Shelter reveals tens of thousands of people are taking out payday loans to cover their mortgages and rent, with one in 50 using high interest credit in the past year. The charity warned that in total, one in five have use overdrafts, credit cards or cash borrowed from family and friends in order to pay for housing in the last 12 months. Shelter surveyed homeowners on their financial worries, and also discovered that a quarter of people would feel too ashamed to get help with housing repayments. The charity also revealed a 30% increase in calls to its helpline over the past year. (Metro p.4)


Released in tandem with the ONS inflation statistics yesterday, the latest house price index from the ONS showed the price of the average UK house rose 5.4% to £248,000 in the 12 months to November. In London, the price rise was more than double that, with the capital seeing a year-on-year increase of 11.6%.

The Metro reacted to this news by heralding housing misery for first-time buyers, with the average first time buyer forced to pay £187,000 – or 6% more than a year ago. Peter Rollings of Marsh & Parsons said: “House price growth has washed over every corner of the UK” but in the Daily Telegraph, Richard Sexton of e.surv warned: “We desperately need more construction in order to prevent the bottom of the market being priced out entirely.” (Daily Telegraph B4, Metro p.47, Daily Express p.28, Guardian p.21, The Sun p.38, The Times p.35)

The Independent Editorial lead with a sceptical view of the ONS figures, arguing that expensive housing distorts the UK economy: “House-builders find themselves in the spotlight. Housing completions have been abysmally low for decades. And whatever David Cameron says, it is difficult to see the Government’s Help to Buy mortgage subsidies boosting supply sufficiently to keep house prices anchored. That is dangerous.” It argued that ultimately, even middle-class homeowners could ‘lose out’ from rising prices (Independent p.2)


‘Skinflint’ bosses who fail to pay workers the minimum wage will face penalties of up to £20,000 from next month say the government – a £15,000 increase on current fines. Business Secretary Vince Cable also said that ministers had made it easier to ‘name and shame’ bosses paying under the minimum wage, and that all calls to the free pay and work rights help line would be investigated. (Metro p.47)

Paper Summary – Saturday 11 January 2013


Optimism about Britain’s economic prospects took a knock after unexpectedly weak official data from the manufacturing and construction sectors was released on Friday. ONS figures said that manufacturing output stagnated between October and November and construction output fell. The news prompted a slight downward adjustment in growth forecasts and took economists by surprise, given that the figures did not tally with unofficial business surveys pointing to swelling output, orders and confidence among manufacturing and construction companies. (FT, p.3) Although public and private housing construction have increased by 10 per cent and 13.8 per cent respectively in the first 11 months of 2013, in November there was also a 3.2 per cent fall in private new housing compared to the previous month. Duncan Kreeger, director at West One Loans said: “Gentle progress is encouraging for the property industry. But it won’t be fast enough to solve the crisis facing families in search of affordable homes, or businesses looking for the right location.” (Independent online)


Personal Finance

More than three million middle-aged and retired people have given up saving for old age, believing that whatever they put aside will be taken away to pay for their care, according to new research from Age UK. The charity argues that the Government’s long-awaited overhaul of the care system, which is currently before Parliament, will fail if large numbers abandon saving for later life, because the system relies on individuals contributing to the cost of their care. The research found that almost three in 10 people aged over 50 believe there is “no point” in saving for their future needs.



David Cameron is accused by the Lib Dems of suppressing a report calling for thousands of new homes to be created in two new cities in southern England, in order to ease the housing shortage. (Telegraph, p.1) The proposed new settlements, which would contain tens of thousands of homes, could be built in Buckinghamshire, Warwickshire or Oxfordshire. The Lib Dems argue that the proposals are being side-lined for fear of a backlash in Tory heartlands ahead of the general election.


The number of people moving up the property ladder in 2013 reached a three-year high in 2013 as rising house prices boosted their equity, according to research by Lloyds Bank. Around 337,500 home owners with a mortgage moved last year, a three per cent increase on 2012 and the highest since 2010. (Express, p.22). Meanwhile, the number of £5m+ ‘superhomes’ being sold in London rose by a quarter last year, according to Savills, suggesting that the top end of the London market has not yet been hurt by higher stamp duty, the threat of mansion taxes, or the introduction of capital gains tax for foreign sellers. (Telegraph, p.16, FT, p.2)



All but the absolute banking elite are expected to be disappointed by this year’s city bonuses, according to the Independent (Jonathan Prynn, p.6). Disappointing results and ongoing restricting in a still recovering industry mean that many will be disappointed when informed of their bonuses ahead of annual results next week. A few so-called superbankers are expected to take home up to £6m, while those beneath them expected to take home the same pay or less as last year. A sizeable minority will end up with a “doughnut” – no bonus at all. 

House Purchase Loans hit a Six Year High, but High LTV Lending dips in December


December was the best month for home lending in six years, according to the latest Mortgage Monitor from e.surv, the UK’s largest chartered surveyor.

There were 77,918 loans advanced to homebuyers in December, the highest number since November 2007. It marked a 40% increase in home loans over the past year, a jump of more than 22,000 approvals from 55,501 in December 2012. Compared to November, home loans increased 10% from 70,758. It was the tenth monthly increase in a row and the largest monthly increase in two years.

Despite an increase in total lending, the volume of lending to high LTV borrowers dipped in December. In the final month of 2013 there were 9,038 loans to borrowers with deposits worth 15% or less of the total value of their property, a 5% decrease from 9,493 in November.

However, high LTV lending is still far higher than this time last year. While total lending has increased by 40% over the last 12 months, high LTV lending has increased at an even faster rate, rising by 60% from 5,661 high LTV loans in December 2012. The figures also show there is still a way to go before high LTV lending will come close to pre-recession levels, with four times as many monthly high LTV loans before the recession, suggesting lending to borrowers with smaller deposits could still be ramped up significantly.

Richard Sexton, director of e.surv chartered surveyors, explains: “There is still a long road to travel before the mortgage market is fully recovered from the hangover of the financial crisis. But the recovery is quickening, and the end is beginning to appear on the horizon. High LTV lending has exploded in the past 12 months, and it is now far easier to take out a mortgage with a smaller deposit saved. There has been something of a festive dip in high LTV lending in the last month, likely to be the result of lower equity borrowers paying for Christmas and delaying their move until the New Year. High LTV lending should continue its recovery in the coming months, but it’s important that Help to Buy remains in place to help support borrowers in building a deposit, enabling them to access better rates, and cheaper deals.”


2013 has been something of a tale of two halves, with the recovery in lending stepping into a new gear in the second half of 2013. House purchase lending increased just 6% in H1 2013, going on to increase by 32% in H2 2013. The recovery in high LTV lending was more evenly spread throughout the year. High LTV lending increased 26% in H1 2013, and a further 27% in H2 2013.

Richard Sexton, director of e.surv chartered surveyors, explains: “The mortgage market had a bumpy beginning to 2013, as fears of a triple-dip recession reigned supreme, and banks were cautious about lending. But while the first half of the year witnessed a moderate uptick in lending, with the seeds of the economic recovery beginning to sprout, the second half of 2013 saw the mortgage market grow at an electric rate.”

More first-time buyers

The number of loan approvals on properties up to the value of £125,000 has increased by 34% in the last year, with 15,584 loans on properties valued £125,000 or under in December 2013, compared to 11,655 in December 2012. It reflects a pick-up in the market, and an increase in the number of lower equity borrowers choosing to move-home or buy for the first-time.

The number of first-time buyers in November 2013 was 28% higher than in November 2012, according to the latest LSL First Time Buyer Tracker, as mortgage rates fell to 3.93% – the lowest on record. But there are warning signs ahead. The average first-time buyer purchase price rose 11% over the year to November, to £149,404.

Richard Sexton, director of e.surv chartered surveyors, explains: “More high LTV borrowers and first-time buyers are looking to buy property now than any other time post financial-crisis. But they are having to fork out more than ever, as prices are driven up by the intense competition for property. Traditionally, first-time buyers have turned to their parents for help building the cash for a deposit – a deposit that is growing larger as prices rise. But inflation has eaten away at many parent’s cash reserves, and this well is beginning to dry up. In order to keep the market accessible for everybody, house building must be ramped up, to prevent the challenge of saving for a deposit form becoming even more difficult.”

News Headlines: Sunday 5th January

Personal Finance

David Cameron has announced a cash boost for pensioners, and has hinted at future tax cuts for middle and top earners, by pledging to extend rises to the state pension to at least 2020. In what he describes as a ‘huge’ pledge to help give people ‘dignity’ in old age, he has promised to maintain ‘triple lock’ pension rises for the duration of the next parliament if he is re-elected in 2015 – each year state pensions will rise by whichever is the highest of inflation or average earnings, or by a minimum of 2.5%. In an interview with the Sunday Times, Cameron hinted to the paper that he also wanted to cut taxes for all workers, and further reduce the top rate of 45p. (The Sunday Times p.1, p.4, The Sunday Telegraph p.1)


In the Sunday Express, Andrea Watson reports on the ‘homes of the future’ – in an article looking at forecasts for the property market. A Cluttons report recently found that house prices in London are now 14% above their 2007 peak, which Watson put down to housing shortages, immigration and the Olympic effect. Cluttons say that the areas most likely to see above average house price inflation in the coming year include commuter towns and university cities in the Home Counties. Watson goes on to quote several property experts, including David Newnes of LSL and Peter Rollings of Marsh and Parsons. She reports that the Government is “between a rock and a hard place on tax because driving away wealthy foreigners could hit the market, but not acting will hand the Opposition a trump card for the 2015 election.” (The Sunday Express p.74, p.77)


After a review of its offshore structure by the HMRC, Google is the first internet giant to be hit with a multi-million pound tax charge. The firm is expected to be charged at least £24m in backdated tax, relating to US shares which were given to employees in Google’s London office, but billed to the company’s Irish subsidiary in order to reduce corporation tax repayments to the UK. Other companies under scrutiny by the HMRC include Apple, Amazon and Facebook. In total the four American giants have avoided up to £1bn a year in tax in Britain, according to analysis by The Sunday Times. The four companies have a combined turnover of £16.6bn, but they paid just £14m of UK corporation tax in 2012, whilst Apple and Facebook paid nothing. (The Sunday Times p.8)


Today is ‘Massive Monday’ – the day we switch jobs. The first Monday back after the New Year is the most popular day to look for a new job, according to the Sunday Times. One in four of us will change careers during our life, with 33 the optimum age for reinvention is. People in their twenties and thirties are the most likely to switch, and they are also the best at it: 62% of those in their twenties and thirties are aware of the cost of changing jobs, and put a plan in place, while only 48% of people aged 30-49 and 40% of people over 50 are prepared. (The Sunday Times p.14)

UK SME Population Hits A Six Year Post-Recession High


The number of active small and medium enterprises (SMEs) in the UK reached a six-year high of 2.16 million in 2013, according to the SME Growth Monitor from the National Association for Commercial Finance Brokers (NACFB).

The UK now has the most SMEs in business since before the downturn after two successive years of growth. Following the loss of 80,615 small businesses between 2008 and 2011, SME numbers have swelled by 4.2% in the last two years (+86,435) compared with a 3.3% rise among large employers (+285).*

England leads the way with 4.6% SME population growth since 2011, closely followed by Scotland on 4.5%. In both cases the revival of small business fortunes has outstripped larger businesses whose numbers have grown by 3.3% and 3.9% respectively.

In contrast, Wales has experienced just 0.3% SME growth in the last two years (vs. 5.5% for large employers). Small business numbers in Northern Ireland have fallen by -1.9%, while its big business population has shrunk even further (-2.5%).

SME growth rate strongest in England and Scotland since 2011





N. Ireland

SME growth






Large business  growth






Nine in ten UK industries see SME growth – outpacing large employers

The post-2011 boom has seen SME numbers grow in 18 out of 20 UK industries*, with the only exceptions being construction (-2%) and wholesale (-1%). In contrast big business numbers have risen in just three quarters of UK industries.

Professional, scientific and technical industries have seen the biggest SME population growth of any sector (+35,905), followed by information and communication (+18,025), health (+6,535), property (+5,580), agriculture (+4,765), education (+3,540) and manufacturing (+3,435).

The greatest shift in sector demographics has been in public administration and defence which boasts nearly twice as many SMEs (+97%) as in 2011 but fewer large employers (-3%).

Adam Tyler, CEO of the NACFB, commented:

“SMEs are the stalwarts of the economic recovery: they have made the early running and played a vital role in brightening the UK’s future prospects. By fuelling activity in greater numbers across the majority of UK industries, they have helped rebuild a strong foundation for further growth. This not only opens up more jobs but also boosts those larger employers who count SMEs in their supply chain or rely on the essential services they provide.

“Uneven growth across the British Isles still shows more work needs to be done to support the revival of small business fortunes. SMEs in England and Scotland have benefitted from innovative business lending, which has increased the mix of commercial finance available to entrepreneurs. Commercial brokers can often unlock new routes to funding on a local level, and a renewed commitment from lenders in Wales and Northern Ireland can satisfy regional appetite for investment to kick-start their SME recovery.”

SMEs most affected as yearly growth rate slows

Despite the positive two year figures – and increasingly upbeat reports on the future of the economy – NACFB analysis reveals the growth of the UK business population slowed between 2012 and 2013, with a greater impact on SMEs than large employers.

While big business numbers maintained a consistent annual growth (1.7% in 2012 and 1.6% in 2013) the yearly rate of SME expansion fell from 3.3% to 0.9%: a slowdown mirrored across the UK.


England’s SMEs visibly outgrew big businesses in number during 2012 (3.5% vs. 2.2%) but were pegged back to 1.1% growth in 2013: the same rate achieved by large employers.

The yearly growth of Scotland’s SME population also slowed during 2013 and fell behind in Wales for the first time since 2011, while Northern Ireland saw a sixth year of SME decline.

In contrast, big business numbers in Scotland, Wales and Northern Ireland each bucked the overall UK trend for 2013 by growing at a faster annual rate than in 2012.

Adam Tyler, CEO of the NACFB, continued:

“The SME population has been the first to bounce back after the financial crisis, suggesting an ability to adapt quicker than some larger businesses and respond to customers’ changing needs. But their small size also leaves them vulnerable to funding shortages, legislative change and the ebb and flow of the economy.

“As the UK recovery moves into second gear, SMEs will need a further hand to sustain their early growth. There are far more funding sources available to SMEs now than before the crash – alternative finance has already stepped up its game and the revised Funding for Lending Scheme should prompt greater volumes of business lending in 2014.

“Business leaders need the reassurance that there are many answers out there to satisfy a call for investment. A carefully chosen mix of commercial funding can solve many business challenges. With NACFB’s online Small Business Finance Directory now connecting thousands of businesses to a network of specialist commercial brokers, work is well underway to join the dots that will lead to greater growth.”