Buying a property is one of the biggest and most stressful decisions of your life. For some it’s the right decision but would you be better off renting?
Benefits of owning
There are a number of pros and cons when it comes to owning a house and it is very important to weigh up your options. One of the biggest benefits of owning your own home is that once you’ve paid off your mortgage, you will own that property in full and can use it as an investment piece. As it’s your own home, you can also make renovations without having to ask your landlord and decorate it to your preference.
Even though your mortgage payments may be your biggest monthly payments, eventually you will be able to pass your house down to your children. What’s more, in today’s climate some experts believe that it is cheaper to buy a house, paying off the monthly mortgage payments rather than renting.
Disadvantages of owning
Whilst owning your home can be a great option, if you’re living with someone and it doesn’t work out then knowing what to do with the property can be difficult. In addition to this, if you lose your job you have to be prepared for your mortgage repayments and if the interest rate rises, your monthly payments will go up. As a home owner you will also need to be sure you can afford maintenance costs such as fixing boilers and any electrical faults.
Owning a home is a huge commitment and it is also important to note that it is not always easy to sell your home and depends on the market. Likewise, if the value of your property falls then you may be unable to sell it if you owe more to your mortgage lender than your house is worth.
All of these financial burdens need to be taken into consideration because if you overstretch yourself then you have to remember that you might not have money for meals out and leisure activities. You also have to remember that you will need a 10% deposit and money for the stamp duty.
Benefits of renting
When owning a home, you have less flexibility than when renting. For example, selling and moving to another location is more expensive and you have to remember as well as estate agency fees, you will also have legal fees. If you often move around for work or want the option of dropping everything to go travelling then renting is probably your best option.
Disadvantages of renting
The phrase ‘money down the drain’ is often thrown around in the renting sector. Rent payments are high and at the end of it, you don’t have anything to show for your financial payments.
Ultimately your landlord is in control and you can be asked to leave at any time. Even with months notice, it can be a stressful period in your life. The relationship between you and your landlord can also be very difficult to juggle.
It’s your decision
There are a number of advantages and disadvantages when it comes to buying or renting and you need to make the decision based on you and you only. The first step to buying a property is deciding whether you can afford it. As well as the house itself, you will also have to pay the deposit, survey cost, stamp duty, removal costs, legal costs and your monthly bills. Then compare this to a monthly renting cost and you’ll have your answer.
However if you’ve got your heart set on buying then why not set up a savings plan? Alternatively the government have set up a number of Help To Buy schemes, which are worth looking into. If you would like to speak to an expert, please get in touch today.