Pros:
The number one pro is the mobility factor. Nowadays when houses are taking increasingly longer to sell it can be wiser to rent so you are not tied to a particular spot. Once the rental term expires you have the choice whether to stay or go; this is ideal for folk who are happy to move at short notice in search of more lucrative work and an improved lifestyle. If you decide you don’t like the area you know you can leave within just a few months if you are renting – not so if you have purchased.
As a tenant you will not have to pay for buildings insurance, only contents cover for your own possessions.
All repairs and maintenance costs will be the responsibility of the landlord of a rental property so you will not have to pay for any of these. You can budget more easily as unexpected costs for repairs will never arise. You can gauge exactly what you have to pay out each month and will have the peace of mind knowing that if the roof leaks it will be taken care of by your landlord – houses can be notorious for eating up cash especially if they are older.
Some say paying rent is dead money but is it? It really depends on what your needs and expectations are from the roof over your head. Many homeowners have interest only mortgages and are in effect ‘Renting’ from the building society. If they have no repayment vehicle in place they will still owe as much to the building society at the end of the term as they do at the beginning. This is all very well if property prices increase but imagine the situation if it doesn’t. Homeowners can often find themselves trapped in negative equity with no chance of ever repaying the loan. Tenants never have to worry about any of this or pay for solicitors’ and surveyors’ fees. Building society fees can also be crippling and financial institutions can never loose if you fall on hard times – they will just repossess the house and you stand to loose everything you have put into it.
As a tenant you can thus move in without any of the costs incurred if you had signed up for a mortgage contract. You just have to pay your bond and the first months rent in advance to your landlord as a general rule but property purchasers nowadays have to cough up a whopping 25% of the entire cost of their home for a deposit.
Cons:
As a tenant there will likely be restrictions on such things as pets, smoking, redecoration and alterations to the property so you won’t have the same control a homeowner would.
It may be difficult to save for a deposit on a house if you are renting but try if you can to put away a little each month if it is your wish to buy your own place eventually.
You are vulnerable from the point of view of the landlord wanting to sell the property at some point and may only be given two months notice to quit if this occurs. Although some properties are often seen listed for sale with ‘A sitting tenant’ the landlord can only sell to another landlord who wants to expand his portfolio if this is the case.
If you are deliberating whether to rent or whether to buy you have to assess your own particular needs and see which the best way forward is for you. Remember that something that may work in the short term may not always work out so good over a longer period.
There is a compromise between renting and buying nowadays which is becoming increasingly popular; these are ‘Shared ownership’ schemes which just mean you own a proportion of the property and rent the remainder until such time as you can afford to purchase a larger part. This allows for greater flexibility and more choice and is an ideal arrangement for young buyers who cannot raise a deposit yet want to get on the housing ladder.
For all your property choices visit rightmove where you can select your ideal home virtually anywhere in the world from those available to rent, purchase or share the ownership.