Is Buying A House Better Than Renting?

When it comes to buying and renting, there's no right or wrong thing to do - only the thing that works best for you. Some people want to own their own property, whilst others are content renting. However if you're unsure about whether you do want to rent or buy, it never hurts to have a list of the pros and cons involved for each to help you decide.

So here at New Home Finder we've put together some of the plus points and some of the minus points for both buying your own property and renting. 

Can you afford to buy?

If you are trying to decide between renting and buying and feel stuck between the two, the first thing you need to ask yourself is whether you can afford to buy - is it even a viable option in the first place?

You will need to have a deposit together - usually this will be at least 5% of the property's value. If you don't have savings already, you will need to work out how much you can afford to save each month for a deposit. This can be a time consuming process and whilst it can seem like a never ending battle to try and get the funds together, try to stick to a strict savings plan. You'll get there in the end - it really doesn't matter whether you own your first home in your 20's, 30's or 40's. Have a read of our blog on how to save for a mortgage whilst renting for some saving tips and ideas to get started. 

If you do have a deposit together, remember however that buying a home doesn't just involve monthly mortgage payments - you need to think about whether what you earn would allow you to buy and run a home comfortably, on top of paying off the mortgage each month. Stretching your finances so thin that you cannot afford to do anything other than pay the mortage, household bills and do the food shop each month will not give you a great quality of life - and can easily lead to regrets of ever buying. Sit down and work through your finances in order to get a handle on what you could and could not afford before you start seriously considering buying a property. 

If you are in a position to buy, but feel unsure about whether it's the right step for you, then have a read of the following pros and cons that go with both buying and renting.

Pros of buying
  • One plus point of buying is that your monthly payments go towards buying the home, and not into the pocket of your landlord.
  • Once you've paid off the mortgage, you'll own your home and will be able to live their rent free.
  • You'll benefit from any appreciation in your home's value over time if you come to sell.
  • If you buy a property, you will be able to make changes to your home without having to ask for permission. So that means decorating your home exactly how you want it.
  • If you have pets you don't need to get permission in order for them to live with you.

  • You don't need to worry about your landlord asking you to move out because they've decided to sell - which can often happen with very little notice. You won't have to find somewhere new to live, pack up and move all within a short period of time if you own your own property.
  • Monthly mortage repayments can actually work out cheaper than paying rent in some instances, so after the intital upfront costs of buying, you could be better off paying off a mortgage than you are renting in the long term.
Cons of buying
  • You will need plenty of money to cover the costs of buying initially - think deposit, legal fees, the cost of a buildings survey and stamp duty. It's not cheap to begin with unfortunately.
  • Owning your own home and paying off the mortgage each month is a long term financial commitment and you must keep up with your mortgage repayments, otherwise you could have your home repossessed and stilll then have to pay off the outstanding balance. 
  • You are responsible for your home's maintenance, meaning that you will have to foot the bill for any work that needs doing.
  • There is no guarantee that your home's value will go up in value over time, especially in the first couple of years.
  • Should you ever need or want to sell your property and move on quickly, owning your home rather then renting can be problematic in this scenario. It can take months to sell a property, and it's expensive to do so and if you're desperate to move, you may have to accept a lower offer on your home.

Pros of renting
  • If you like to move around a lot, change jobs and are not ready to settle down in one location, renting property is a great option. It's far easier to move home quicker, and it's also usually quicker to find and rent somewhere than it is to buy. 
  • It's a great way to test living with other people and in different locations before you commit to living in one area or with one person. If it doesn't work out, it isn't really a problem as it's far simplier to move on that it would be if you were to have to sell a property.
  • If you rent, you also don't need to worry about the cost of any repair work that might need doing to or within the property - it's your landlord's responsibility to fix any problems such as broken boilers for example.
  • As you needn't worry about having to fork out for unexpected repairs, it can be easier to predict your monthly costs when renting. 
  • Renting can also offer you the opportunity to live in a nicer property and in a nicer area than you perhaps could afford to buy, meaning renting is a good option for people who prefer to live in a nicer area rather than own their own property.
Cons of renting
  • At short notice, you can be asked to vacate the property. This can be a huge inconvenience if you were settled and not looking to move. Likewise, there is no guarantee that a lease will be renewed when it expires, meaning you'd have no option other than to move. 
  • You'll have to ask permission before you make any changes to the property, meaning you could find that you're expected to live with magnolia walls for the duration of your tenancy if your landlord would prefer you not to decorate. If you can decorate, you may be required to paint the walls white again before you leave. 
  • Your landlord can choose to put your rent up, meaning you could end up paying more on rent a month than you orginally intended. 
  • You ultimately don't own the home, meaning you won't benefit from any appreciation in its value over time - only your landlord will. 
  • Think to the future - if you never own your own home you will always have to rent, even when you've retired.

Publish date: 28/08/2018

Publisher: New Home Finder