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Should I rent or buy a house?

 

Buying a home is a massive commitment and it can seem easier to rent rather than jump onto the property ladder – but could it cost you more in the long run?

Obviously buying a home is not something you can just rush into – for the vast majority it takes months, even years, to save the deposit required.

The thought of scrimping and saving for years does seem rather off-putting, but when you consider Zoopla’s research shows buyers in Aberdeen will be £99,000 better off than renters after seven years, you have to wonder if maybe it’s worth it.

However, the same research shows it would take buyers in London 18 years to feel the same benefit.

So, what are the pros and cons of buying or renting the place you call home? We’ve put together some of the most important things to consider:

The pros of buying

• It’s more secure – once your house is bought it’s legally yours which means no pesky landlord to worry about

• Putting your stamp on it – again, without a landlord telling you what to do, you can decorate how you see fit. Even if you see fit to hang pictures of Harry Styles you can – you shouldn’t, but you can

• Boost your credit rating – paying monthly mortgage payments means your credit rating will gradually improve

• Gain equity – if you make improvements to your home or house prices rise your home could gain value and that could help you pay a deposit on your next property if you decide to move

The cons of buying

• An abundance of costs – owning a home certainly doesn’t come cheap, the mortgage is just one part of it. You may need to carry out improvements, you’ll need to insure it, pay council tax and a whole host of other bills on top. Make sure the sums add up before taking the leap

• Lose equity – there is a chance it could go the other way and your home could lose value when you try to sell it

• It’s an anchor – if you're renting and your dream job comes up a hundred miles away then no problem, you can give a month’s notice and be on your way. The same can’t be said if you own your home

The pros of renting

• Absolute freedom – bored of your home or need to move for work, love, family commitments? No problem, just give a month’s notice and you can be on your way

• Just worrying about your stuff – when it comes to insurance it’s just contents cover you’ll need in place. You can let your landlord worry about the structure

• Broken boiler? Ring ring – your landlord has to deal with any maintenance issues, so if the boiler breaks down you won’t be cold for too long and it won’t leave you out of pocket

• Meeting new people – house shares are the perfect way to make friends for life and the ideal way to pay less for a nice pad

The cons of renting

• Dead money – when you pay a mortgage you are at least contributing towards something you will eventually own – when you pay rent you’re just boosting your landlord’s bank balance

• Annual increases – rental prices are directly affected by inflation, so that rent which seems reasonable now could steadily creep towards the unaffordable

• No creative freedom – your lease agreement may stipulate you can’t make any alterations to the property, meaning those bright red walls are something you have to live with

• Lack of security – you may love your home and it may be ideally located for work but if your landlord wants to give you notice or decline to renew your contract, then you’ll find yourself looking for somewhere new.

According to, Lawrence Hall, from Zoopla: "It’s important to remember that while renters may be better off in the short to medium term in some areas of the country, buyers are making a long-term investment.

"With most buyers opting for mortgage terms of 25 years, over the long term buyers are likely to be better off compared to those who choose to rent."

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