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- Today's business and finance round up 15th June 2021
Today's business and finance round up 15th June 2021
🏡Cheaper to buy or rent a home?
15th June 2021

Good morning Could football be coming home? Half of Brits believe England can win Euro 2020 with men over 55 being the most optimistic and 18-20 year olds the least optimistic.
Today's stories
Cheaper to rent or buy a home?
Ted Baker shakes up strategy
Yesterday's market moves
FTSE 100 +0.2% 7,147 FTSE 250 +0.1% 22,745
Markets extended their winning streak with the FTSE 100, already at its highest since February 2020, edging up a further 0.2%. Investors are eagerly awaiting further clues from the US Federal Reserve on Wednesday about the possible timing of any interest rate rises.
PROPERTYCheaper to buy or rent a home?

What’s going on?Research from estate agent Hamptons shows that for the first time in almost 7 years it’s cheaper to rent rather than buy a home. Why is this important?Home ownership is a top financial aspiration for many Brits. In recent years it has been the most cost effective way of keeping a roof over your head, in part due record low interest rates on mortgages.In early 2020 it was cheaper to buy than rent in every region of the UK. A buyer with a 10% deposit would have been £102 per month better off buying than renting.Then Covid-19 hit. Millennials and Gen Z left city centres in droves to return home to live with parents, sending rental prices down. In central London rents have fallen over 20% in the past year.At the same time banks became more cautious over lending and asked for higher deposits to get a mortgage. During the pandemic house prices have grown strongly with people looking for bigger homes outside of urban areas.All this made renting more affordable than buying a home for the first time since 2014. In May 2021 it was cheaper to rent than buy in seven of Britain’s 11 regions. It was £71 per month cheaper for a typical first-time buyer with a 10% deposit to rent a home than it was to buy. The only areas where it is cheaper to own than rent are the North East, the North West and Yorkshire & Humber.London has seen the largest shift since the start of the pandemic. A buyer putting down a 10% deposit on a property in the capital will have gone from being £123 per month better off buying in March 2020, to spending £251 per month less on rent in May 2021.
TakeawayWith the cost of renting relative to buying at the lowest level since late 2013, it’s likely the balance will swing back towards buying, particularly as mortgage rates come down. However, this could be partly offset by rising house prices. It’s likely then that the gap between renting and buying will close over the coming months, moving back towards longer-term levels next year.
RETAILTed Baker shakes up strategy
Retailer Ted Baker, known for its smart floral occasion wear, reported a 44% drop in sales to £352 million for the 12 months to January. The company made a £108 million loss during that period. And performance isn’t looking much better in 2021, revenue between February and April is down almost 20%.While this is not surprising given that for most of that time we were in lockdown and had nowhere to get dressed up, Ted Baker has had issues long before the pandemic.
There was a ÂŁ58 million accounting error discovered in January 2020.
Chief Executive and founder Ray Kelvin left the business in March 2019 following misconduct allegations, that he denied.
The retailer was slow out the gate when it comes to selling online which meant it wasn’t prepared for the pandemic.
To adapt to the new world of remote working and more online shopping, Ted Baker announced some changes to its strategy.
Creating outfits that could be “dressed up or dressed down” to suit staying at home during lockdown or going out to events.
Closing stores that were no longer viable due to lower high street footfall.
Trying out pop-up stores in smaller towns to be closer to customers who would have otherwise have commuted into city centres.
The market seemed unconvinced by the changes and shares fell 8% on the day.
Stat of the day
Poor mental health costs UK employers up to ÂŁ45 billion a year
Other stories to keep you in the loop
Ministers confident Covid restrictions will end on 19 July
Netflix opens official merchandise store
Bitcoin price back above $40,000 after Elon Musk comments
Shell could make $10bn exit from US shale operations
Canary Wharf boss: 'FOMO' will bring staff back to the office
Serco in new boost to profits from coronavirus services
