The Know Daily - Tuesday 22 August 2023

_{Tuesday 22 August ∙ Read in 5m 24s ∙ Listening to Tina Turner}

More than 200 water voles have been released at a secret location in the Lake District in an attempt to create a thriving population of the endangered species. Water voles were once widespread across the UK but over the past 100 years their number has dropped from about eight million to 132,000.

🏠 To own or not to own

Rising mortgage rates mean that for the first time in over a decade, it is now cheaper for would-be homeowners to rent rather than buy a property.

Tell me more.
According to property website Zoopla, the average UK rent is now £1,163 per month, while average mortgage repayments are £1,285 for first-time buyers. This is a difference of £122 a month, or an extra £1,500 per year for homeowners.

Zoopla based its calculation on the average value of a UK home of £263,000, with a 15% deposit.

Is it the same picture across the UK?
No. “There is a clear North South divide,” said The Telegraph. It is still cheaper to buy than rent in northern England and Scotland, while the situation is reversed in every part of southern England and the Midlands. Perhaps unsurprisingly, the difference is most pronounced in London.

What could the impact be?
It is the first time since 2010 that it has been cheaper to rent than to buy - despite the fact that rents have also been rising rapidly in recent months. Zoopla has warned that the difference is likely to increase demand for rental homes, driving up prices even more.

So what’s going on with mortgage rates?
While some banks have begun cutting rates, the average two-year fixed-rate mortgage now stands at 6.76%, according to Moneyfacts, and at 6.24% for a five-year fixed deal. This is more than double what they were in early 2021.

Mortgages have increased as the Bank of England raises the base interest rate in a bid to tackle inflation by making borrowing more expensive. The base rate currently stands at 5.25%, but it is widely expected to rise for the 15th time in a row in September. Economists predict that rates will begin to stabilise in 2024.