If you’re one of the growing number of people in the UK who don’t own their own property, you may now be living in a rental property, at home with family or in a shared house with colleagues or friends. Whilst we have traditionally been a nation of homeowners, more and more people are now finding buying a property out of their reach. So, is it worth trying to save for a deposit and try to gain a foot on the housing ladder or is it best to decide to be a lifelong renter?
Benefits Of Owning
- Once you have paid off your mortgage, your home is yours, and you won’t ever have to worry about paying for somewhere else to live.
- If the home that you have purchased increases its value, you can use this to purchase yourself a bigger home or use it in another way to fund a comfortable retirement.
- You can do what you like to your own house, decorate as you wish and improve it and a whole host of ways without having to ask the permission of a landlord.
- Sometimes, depending upon the financial climate of the time, it can be cheaper to buy than rent.
The Downsides Of Owning Your Own Home
- Owning your own home can be a big commitment. It can be especially so if you are buying with somebody else, as it could bind you together for over 25 years. What happens if you split up during that time?
- Mortgage payments can go up. This means that unless you have a fixed rate or capped mortgage if interest rates go up, so will your mortgage payments. We are currently experiencing very low-interest rates in the UK, and if they were to rise to levels we have seen over the past 30 years, we could see mortgage repayments rise significantly.
- Homeowners are responsible for the maintenance of their property. When renting, if your central heating is faulty, your boiler breaks down, or your roof needs urgent repair, your landlord is responsible for these, and the repairs cost you nothing. However, as a homeowner. You are responsible for these sorts of repairs, many of which could run into hundreds or thousands of pounds.
- If you buy a house and it means that you have to really stretch your budget to do so, you may have to cut down significantly on elements of your social life such as nights out and holidays.
- When you buy a home, you can end up in what is called negative equity if you find that you do so in rather bad financial times. This is where you owe your mortgage lender more than your home is actually worth. This can make it impossible to sell.
- Buying a house is not as flexible as renting. For example, if you get a job in another part of the country, selling up and moving is more expensive as you have estate agency and legal fees to pay.
There is no answer as to whether it is better to rent or buy, and it is really just down to your own personal circumstances as to what is best for you.