More than half of former renters who bought their first home in September have seen their monthly housing costs increase, new research has found.

Hamptons says that 56% of first-time buyers who were previously tenants are now paying more on their mortgage than they did on rent.

This marks a reversal from the period up to July, which was the last time that more than half of first-time buyers saw their housing costs fall after getting on the ladder, with mortgage payments lower than their previous rent.

The average mortgage payment for a first-time buyer leaving the rental market reached £1,227 a month in September.

On average, buyers are paying £39 more a month than their previous rent.

Small deposits are a key factor in pushing up costs for buyers.

Buyers whose mortgage payments are now higher than their previous rent purchased at an average 91% loan-to-value, equivalent to a 9% deposit.

Those whose mortgage payments are now lower than their former rent bought at an average 83% LTV, equivalent to a 17% deposit.

Older first-time buyers are the most likely to see their monthly costs rise.

Hamptons says this partly reflects older buyers purchasing larger homes and taking shorter mortgage terms.

It found 67% of buyers in their 40s are now paying more for their mortgage than their previous rent, with monthly costs up by an average of 18%.

Among first-time buyers in their 30s, 58% are paying more after buying, with mortgage costs on average 7% higher than previous rent.

By contrast, less than half of those in their 20s had a mortgage payment higher than their previous rent and on average their mortgage costs were 7.5% lower.

Buyers in their 40s had an average term of 27 years, compared with 31 years for those in their 30s and 34 years for buyers in their 20s.

Meanwhile, annual rental growth on newly let homes accelerated for the tenth consecutive month in September.

Average newly agreed rents across Britain increased by 2.7% year on year to £1,433 a month, the fastest annual growth since November 2024.

Excluding London, rents rose by 3.3% to £1,196, while Greater London recorded growth of 1.5% to an average £2,357.

The South East recorded the strongest increase at 4.6%, followed by the South West at 4.1%.

Hamptons head of research Aneisha Beveridge says: “When interest rates were low, the financial case for tenants to buy as soon as they could was fairly straightforward.

“Saving a deposit was difficult, but buying usually brought an immediate fall in monthly housing costs, alongside the chance to fix those costs for longer.

“Higher mortgage rates have turned that equation on its head.

“Today, more than half of renters who buy are taking on a higher monthly payment than the rent they have left behind.

“The long-term benefits of home ownership – building equity, greater security and eventually owning a home outright – remain.

“But the immediate monthly saving that once rewarded tenants for making the leap has largely disappeared.”

She adds: “Rental growth on newly let homes continues to gather pace, with the acceleration now spread fairly evenly across markets outside the capital.”