New data has shown that renting a home in Britain is currently almost 10 per cent more expensive than buying a new property.

According to Zoopla.co.uk it is also cheaper to buy than rent in 40 out of the 50 largest towns and cities in the UK.

Milton Keynes is at the top of the list of places where renting is the least attractive option, where average rents ecxeed the cost of servicing a mortgage by 43 per cent.

The research involves comparing the current asking prices and rents of two-bedroom flats around the country. It also assumes interest-only mortgage payments of 5 per cent per annum.

Even in the capital, buying is still 16 per cent more cost-effective than renting.

Business development director at the property site, Nicholas Leeming said: "Almost 750,000 would-be first time buyers have reluctantly ended up as renters over the past three years as a result of being unable to get a mortgage.

"With current house prices and interest rates where they are and with rents on the rise, for those who can get a mortgage, there may never have been a better time to buy."