The decision to buy or rent your first home is a difficult one. So, if you’re still sitting on the fence, read for some top tips and guidance…
The prospect of moving into your first home – exciting right? You’ve finally outgrown the bedroom you’ve been occupying in your parent’s house since you were six, and you can now find a spot for all the belongings you’ve accumulated over the years. Time to truly start a brand-new chapter of your life.
Before you start surfing the web for your dream property, you’ll need to take a second to ask yourself: ‘should I buy or rent my first home?’. No matter where you’re from, your choice will decide whether you need conveyancing advice when you buy a property in Worksop, or a contract review when you consider renting a flat in Bristol.
Preparation is key! So, to find out more about whether buying or renting your first home is the right option for you, keep on reading…
What are the Pros of Buying a Home?
Starting with the pros of buying a home instead of renting, there are a couple of great factors to consider:
When you buy a home, it’s yours to do with as you wish (within reason, of course!). You’ll be free to make all the renovations and improvements you want without a landlord going against your wishes.
Want to paint the walls neon pink? Go for it. Have a burning desire to knock down the walls between the kitchen and dining room? Have at it. Always wanted a carpet with a built-in trampoline? Strange choice, but it’s yours to make.
Your Property Can be an Investment
As life moves on, you may well want to move on from your first home. That may be because you want to grow your family, or it could simply be because you feel you have outgrown the space you’re living in.
The beauty of buying a property is that it can be used as an investment to help you trade up to your next move. Bonus point: if your property gains in value because of your own handy work, then you’ll be the one who reaps the rewards. Brilliant!
What are the Cons of Buying a Property?
It may be a tad dramatic to suggest that freedom comes at a cost. That said, there are some drawbacks to buying a home, compared to renting:
Everything is Your Responsibility
If there are ever any maintenance issues or something more serious to sort, you’ll be solely responsible for making sure it gets fixed. That could mean finding the time to carry out repairs yourself or delving into your pockets to find an expert. What’s for certain is that there won’t be anyone solving those problems for you.
Putting a Deposit Together Can Take Some Time
Yes, you don’t need to fork out for the full value of your property (no one would ever move out if that were the case), but you do need to put down a deposit before your mortgage gets sorted.
That can be tricky, as any sort of deposit will still be a sizable chunk of money, and it will take time to gather up the necessary funds. So, if you’re itching to get on the move as soon as possible, buying a home might prove a tad tricky.
What are the Pros of Renting a Home?
Now let’s move onto renting a home, starting with the pros…
Renting is Much Quicker
If you want to get on the move quickly, then renting could well be the way to go. The application process can be much simpler, and you’ll need a substantially lower deposit before you move (often the equivalent of a month’s rent).
Renting properties that are currently unoccupied can be even quicker, as there is no chance you’ll get yourself caught up in a messy property chain – there’s nothing worse than that!
Your Landlord *Should* Take Care of Things for You
If you’re renting a property from a proactive and engaged landlord, you won’t need to concern yourself too much with the finer details. All you’ll need to do is pick up the phone and let them know what the issue is. It’s then their duty to make sure the problem is fixed. If they don’t, they’ll be opening up a whole can of worms.
What are the Cons of Renting a Property?
Finally, what are the cons of renting your first property instead of buying? Let’s take a look…
Your Options are Limited
Most rental agreements will be pretty limited in terms of the changes you can make to your home. It’s pretty common for rental homeowners to be unable to make simple changes, like the colour of the walls or putting up pictures.
If you’re the type of person who likes to put their own personal flair on things, that’s not always possible when you rent your first home.
Renting is Expensive in the Long Run
You may not have to put down a hefty deposit, but monthly rent payments tend to be rather expensive, especially in the long run. Obviously, what you pay will differ between properties, but rent prices can seriously mount up over the years. Just because there are fewer upfront costs, it doesn’t mean it isn’t pricey.
Frequently Asked Questions About Renting or Buying Your First Home
Is it Cheaper to Rent or Buy?
It depends. No matter which option you choose, there will still be monthly payments to organise in the form of mortgage or rent. The key difference will be what you have to pay upfront.
Buying a first home requires a sizable deposit, usually being a minimum of 10 per cent of the value of the property. However, to make things more manageable for first-time buyers, there are first home schemes available in the UK, such as Help to Buy, which lower the minimum deposit to make a purchase more manageable.
You’ll also need to weigh up the monthly payments. Depending on where you want to live, it may be the case that the monthly mortgage payments work out cheaper than the rent costs in your area. Doing a little bit of research can’t hurt, right?
Neither option is definitively cheaper than the other. You’ll have to take your savings and income into consideration and make a judgement on what options are within your price range.
Are There Hidden Costs When Buying or Renting?
There can be…depending on what you would consider being ‘hidden’.
There won’t be many extra fees to worry about if you are renting. You’ll usually have to sort out your bills (including gas, electric, water, council tax etc.) on top of your monthly rental agreement, but that’s par for the course.
When you’re buying a home, there will be a number of fees you’ll have to address. The list could include valuation fees, conveyancing fees, stamp duty (if applicable), and ground rent charges.
Who Can I Go to for Expert Help?
To help you clarify any questions surrounding your decision to rent or buy your first home, you’re going to need some help. Of course, that’s assuming you aren’t already a master of the property market – if so, why are you still here?
Help is always around the corner, and there are plenty of experts you can rely on. Whether you are renting or buying, it’s always wise to speak to a conveyancer about the potential transaction so they can run through all of the details you may have or missed or don’t understand.
It may also be wise to speak to a financial advisor if you are concerned about whether you are going to be able to afford certain options.
How Long Will It Take to Buy or Rent?
At the risk of repeating myself – it depends! To be more exact, there are a number of external factors that are likely to affect the time it takes to complete a property transaction, whether that be a rental agreement or a purchase.
To illustrate, buying or renting a property isn’t always down to you. You may complete everything quickly and efficiently on your end, but there’s a risk you’ll be at the bottom of a property chain. Then, you’ll need to rely on other property transactions further up the line before you are able to move in.
The lesson, then, is to get an idea of what the current occupiers (if there are any) are trying to do before you put all of your eggs in one basket, so to speak.
Did You Rent or Buy Your First Home?
There you have it! Hopefully, this short guide has given you a better idea about the sort of things you need to know if you are weighing up the decision to buy or rent your first home.
If you’ve already purchased or have started renting your first home, why not leave a comment below with your own advice so we can get as much information out there as possible?