It’s an age-old question. But does it have a definitive answer? Our estate agents in Newham believe it does and it is up to you. Keep reading to learn more about the pros and cons of renting a property as well as the benefits vs. disadvantages of owning a property so that you can decide which option best suits your needs, budget, and goals.
What you can find in this article:
Pros of Renting a Property
With interest rates rising and making it difficult for first-time buyers to climb onto the property ladder and with demand way exceeding supply, renting a property vs. buying one is a reality for many. But is renting actually a bad thing?
Our Newham estate agents believe it is not. In fact, here are at least 5 reasons why renting may actually be better than buying a property:
Renting obviously comes with fewer upfront costs as well as long-term maintenance costs. For one, when renting a property, you won’t need a deposit higher than a month’s rent. Buyers, on the other hand, need to have an average deposit of £62k to purchase a property.
This high cost makes it impossible for many to save up such a high amount, making renting a more attractive option. Renting is also a more attractive option for those who prefer to put their money to work and make different investments instead of spending it all on a home.
While we are on the subject of costs, renting also has another advantage. That is, no maintenance costs. When you own a home, you are also responsible for keeping it in good shape and making necessary repairs and maintenance and refurbishment works, especially if you don’t want your property’s value to go down.
Renters, however, have the luxury of calling their landlord anytime something breaks or needs repairs in the home, from the plumbing to the heating and appliances.
When you buy a home, you make a huge commitment not only money-wise but also location-wise. And as much as you invest in your property to bring it up to standards and make it your own, you will never be able to change where it is located. This means you either have to settle or spend time and money putting the home on the market should your situation change and require you to move out.
When you rent a home, moving elsewhere is easy if you change jobs, find a better location, or want to escape the neighbours. All you need to do is give your landlord a month’s notice and you’re out of there.
Homeownership costs are not only high. They are also unpredictable. With interest rates rising at a worrying rate, it’s difficult for homeowners to predict their finances, particularly in the long run.
The main advantage of renting, in this case, is the fact that it offers predictability. You know exactly what your home costs each month, no matter how the interest rates rise and no matter what maintenance or repair works the property may need.
Buying a home in an exclusive area is not for the weak of heart. Or budget, in this case. However, renting a home in an exclusive area may be easier. This means that, as a renter, you can afford to live in a better area than you would live as a homeowner.
There is no denying that the safety standards imposed on landlords are high. Landlords are required to meet many requirements and ensure their properties are up to date when it comes to safety equipment and maintenance. This makes properties for let safer than properties for sale and allows you, as a renter, to not worry about any of the costs associated with meeting these safety standards.
Pros of Owning a Property
Now that we’ve seen what the main advantages are when it comes to renting a property, let’s take a look at the pros of owning a home.
The main advantage of owning a home is that you can make it your own. There won’t be anyone telling you you’re not allowed to put a painting up or make your living room wall bright red. And there won’t be anyone telling you that you can’t have five cats if you wanted to.
While renters don’t have to worry about maintenance, repairs, or refurbishment, they also do not have the freedom to choose how the home looks, what decorations it has, or who you can share that space with.
It is true that, when you rent, you can move out anytime you want. But, on the other hand, the landlord can also tell you to move out even when that is not what you want.
Owning a home gives you more security and a higher sense of well-being.
More Potential for Income or Savings
The costs associated with owning a home can scare many away from buying. However, there are two sides to each coin. In this case, this means that a home can also generate income, not just spend your money.
If you own a home and make improvements to it or if you buy in an up-and-coming area like Newham, the value of your home will go up. In some cases, the difference between the purchase price and sale price can be quite significant as our Newham estate agents well know.
In addition, as a homeowner, you can also decide to let your property and have it generate constant income.
Last but not least, if you are able to save up and have a large deposit when buying a home, you will find that buying is actually cheaper than renting.
If you are looking for a new home in East London, our experienced estate agents in Newham can ensure you have access to the best properties and will help you secure the best price. Contact our experienced agents today at 0207 055 0441 to learn more.