Choosing Whether to Rent or Buy Your Own House
Stepping onto the property ladder is a huge decision and you should make informed ones to prevent things from going down the drain. This involves ultimately choosing whether to continue living in rented accommodation or finally buying your own house.
Owning a home, however, may seem like too big a decision for a lot of people, but would feel with the while once done successfully.
But what if buying your own house isn’t just for you? Have look at this comparison to help you decide.
Owning vs Renting
The ultimate question you should be asking yourself is this:
Do you want to live in a house that you won, or are you alright with living in a place that somebody else owns?
Remember that owning a house means you can do whatever you want with it, whenever you want. Whereas with renting, you will generally need your landlord’s permission to make most changes - from painting the walls to mounting frames on them.
More so, landlords may not often allow pets within the property, especially within condominium and apartment buildings. However, renting may just give you the flexibility that you need - moving out as needed or when the minimum tenancy period expires.
Rent Money vs Mortgage
This bit is quite crucial. Majority of the homeowners would encourage you to put your money on mortgage repayments rather than continuously paying rent; as in the end, you’ll eventually own the house you’re living and paying money for.
Reports have also had it that at present, a homeowner may be able to save up to £1,300 a year if their money goes to mortgage repayments instead of rent.
On the other hand, renting gives you as much financial flexibility as you need. If your income significantly decreases and you can’t afford the rent where you are living at present, you can choose to find a cheaper place.
Investment vs Additional Cash
Buying a home would generally require you to get a mortgage, unless you’ve saved hundreds of thousands in the bank. And to get a good mortgage deal, you should also have a reasonable amount of cash ready for the deposit. A larger deposit could mean lower monthly repayments, whilst a lower deposit may mean just the opposite.
Besides the huge money involved in buying the property, there are also other upfront costs to consider: conveyancing, Land Registry, Stamp Duty, surveys, valuation, etc. - not to mention your mortgage application fees that could come in quite costly.
Renting, on the other hand, does not require as much upfront money, thus giving you more cash to spend on other important things on a short-term basis.
Your deposit on buying a house, however, poses as an investment, whose value could increase over time.
What It Comes Down To
Deciding whether to continue renting or to buy your own home needs a lot of careful thinking. What works best for your friend or someone close to you may not exactly be right for you, and no one can shove it down your throat. What you need to determine here before coming up with a decision if your own lifestyle and financial situation.
If you’re always on the move because of work and you’ve got no one to manage the house you’re looking to own, then perhaps you’re better off renting (while saving for your own place when retirement comes). But if you’re looking to see the fruits of your hard work, and you’re not required to be at one place after the other for a prolonged period; also, given you have enough savings to afford owning a home, then you should.