Home Ownership Vs Renting – First Time Buyers
HOME OWNERSHIP V’S RENTING By Malcolm Davidson
I believe that the majority of people in the UK would rather buy than rent given the choice, although being a Homeowner isn’t right for everyone. For example, putting down roots in East Yorkshire could make it more difficult for you to work in another part of the country if the opportunity arose and some people like the flexibility that renting gives them.
However, perhaps unsurprisingly, I come down firmly on the side of Home ownership.
Here are three reasons why:
- Home Ownership in Retirement
One of the disadvantages of renting privately is that at any time your Landlord could decide he wants his house back or even sell it. Yes, you will receive notice but this can be from anything as short as 2 months. This is far from ideal, especially if you had children in a good local school. Many tenants complain that their Landlords do not carry our repairs in a timely fashion and they do not feel inclined themselves to improve the property when it is the Landlord that would benefit in the long run. Some tenants do not feel the same sense of belonging to a community as Homeowners do as they never quite know how long they’ll be living there.
Home Ownership in Retirement
Who really wants to be paying rent in retirement? It’s bad enough not knowing how much our pensions will be worth in the future (or indeed when we will actually retire but that’s another story) but almost all of us will retire on an income lower than we had been used to when we were working. Paying rent from this reduced income would cause lifestyle issues for most people and we might end up reliant on the state for housing in our old age. If you buy a property and get the mortgage paid of before retirement then you won’ have to worry about that, just how you will pay for the vital things in life such as food and the bills (and maybe even the odd holiday!).
If you are lucky enough to have a family then it’s a nice thought that you can pass your property down the family tree for your children or grandchildren to benefit from. This has actually been one of the most popular reasons people in the UK cite for Home Ownership, especially those that purchased their first property under the Right to Buy scheme in the 80’s and 90’s. You can also raise capital yourself from the value of your property in the future such as for equity release or long term care costs.