As solicitors that provide a conveyancing service, we are happy to have this debate. Sure, someone choosing to rent over buying will probably mean that we are not needed for that transaction – but we would prefer that everyone simply makes the best choice for them and their lives.
Millennials are having a massive debate over whether renting a home or purchasing a home is the best idea. As with most arguments in life, the answer lies somewhere in the middle. One is not infinitely better than the other. As both are viable options it becomes about which is more aligned with your lifestyle and the way you yourself want to live.
Buying a property is going to come with its positives and negatives just as renting will. Think about your lifestyle and your money situation before you get carried away with notions like ‘I have to rent because X, Y or Z’ or ‘I have to buy because of X, Y or Z’. You can’t go wrong by making the most informed decision possible according to the way you want to live.
There is so much to cover that this kind of decision needs to be thought about long and hard by you, your family and possibly someone like a financial advisor. As we can’t cover the whole topic in phenomenal detail we will simply raise some key issues that you may or may not have considered when choosing between renting and buying a property.
Remember, if you are having doubt about the decision, you can feel free to come and speak to your expert conveyancing solicitors from Manchester to go over it with you. Our best interest is always longevity. We only want the deal to work for you. Our interest is never in misguiding you for a quick buck. We want to build long term relationships with as many people as possible.
Your money situation is going to be a big factor. The person with £0 in the bank is going to have a hard time getting anywhere to live and the person with £100m in the bank can think about buying property to let out to other renters.
Make sure you really understand your money situation. This is a complicated issue in and of itself. You have to be able to see where you are now and where you are likely to be in the future. For example, if you were to get a sizeable mortgage for a home but you know that your income is extremely unstable – this might not be a wise move. However, if you have a stable career with a good amount of savings and other industry opportunities – maybe it will not be a problem.
So think about your money situation now and where it could be down the line as to whether you want to do something like take out an expensive mortgage.
Is it likely that you will want to travel one day? If you don’t make a lot of money, paying for a mortgage in England while traveling to Asia and paying for your accommodation out there might not be an option. However, renting really could be. If you do want to travel maybe this means you should get it done and out of the way now so you can consider owning a home in the future.
Stay more liquid
If you want to buy a property it’s likely you will need to pay a deposit. Let’s say the deposit for the home you want is £10,000. Does it make more sense for you to put that towards a deposit now or does it make more sense for you to use that money? That £10,000 might be able to make you more money (use it to buy time at a rented property or invest in something for example) if used on something else now rather than bricks and mortar.
One day you might be able to sell your property and make a return on that £10,000 anyway, but maybe the £10,000 is worth more to you now than it will be in the future. Maybe you have the money and have no reason to spend it and investing in the property makes the most sense for you right now. Neither is right or wrong.
Will the property you buy increase in value?
Maybe you live in a rundown area where properties are only decreasing in value. There’s a lot of crime, very little development and very little money. But you have to be there for family reasons or for work purposes.
Accordingly, it might be a waste of money purchasing a property in this area. You might pay £300,000 over 20 years and the property only be worth £265,000 by the end of the venture. Clearly this would defeat a clear benefit of owning over renting. All the money you have invested into the property over the last two decades (windows, roofs, refurbishments, furniture, carpets and the list goes on) has made you a loss. In the same vein – if you live in an affluent area that is only growing in economical and social terms then investing in a property could be a savvy move.
These are simply things to think about if you think you are already completely sold on ‘definitely buying’ or ‘definitely renting’. Making the decision to buy or rent is never easy so you should think about it long and hard. People mess this up all the time. Consider everything in your life like your current situation and future. Remember that neither are right or wrong and you should make an informed decision based on the life YOU want to live and not what you hear from some other third party.