“Should I rent or should I buy?” – It’s a big question that everyone will ask themselves at some point in their lives. It can be a hard one to answer too, especially if you’re a first time buyer in Newcastle.
You’ll find that, in the majority of cases, the option that people choose is down to their personal and financial situation (like most things!). You have to think about where you are now and where you’ll be within the next five years when it comes to making decisions such as choosing between buying or renting.
Both renting and buying have their own perks, however, you’ll find that the majority of people will choose to buy over rent a property; here’s a couple of reasons why they may choose to do so:
Generally speaking, depending on whether you’ve got past/current credit issues, monthly repayments for a property that is being bought over rented are usually cheaper. As a mortgage broker in Newcastle, we’ve learned that if you have a good credit score, you could be able to access better mortgage rates. Competitive products or not, you may also be able to obtain a mortgage with only just a 5% deposit or otherwise known as a 95% mortgage.
On the other hand, interest rates can vary and sometimes you may end up paying slightly more for your mortgage payments. For example, this could happen if you are on a tracker mortgage; this mortgage type bases your interest on the Bank of England’s base rate, which has the habit of occasionally fluctuating. This means that your payments could too.
When renting, unless your landlord decides to increase your payments, you should be paying a fixed monthly rate. Unfortunately, it will be rare for your landlord to decrease your payments, they usually only ever bump them up!
Owning a property is much different to renting one, particularly in the sense of home security. Whilst living within the property, assuming that you keep up-to-date with all of your mortgage payments, no one can tell you that you have to move out of your home; you are under full ownership.
Whereas, if you choose to rent over buy, the landlord can ask you to leave at any time that they want. All they are required to do is give you a ‘move out by’ date. Not being in control of when you move out of a property is always a risk that comes with renting.
If the reason why your landlord is asking you to move out is that they are wanting to sell on the property, you may be able to approach them and try and buy it from them. They may even offer you first refusal as it saves them both time and money with estate agency fees, etc.
At the end of the day, if you choose to buy a property over renting one, you will not only have homeownership, you’ll also be a step up the property ladder.
With ownership also comes responsibility. When you own a property, you will be responsible for all of the repairs, damages, faults that come with it. This could be as simple as a light needing to be replaced, to a new heater.
Some people see renting as wasted money; this is not always true. You have to consider your own personal and financial situation and judge whether or not that it’s the right time in your life to buy a property. If it isn’t, renting may be the better of the two choices for you.
Renting is often a popular and easy option for people wanting to move out from their parents/carers household and haven’t quite decided on whether to rent or buy yet. As a mortgage broker in Newcastle, we’ve seen that renting is often used as a stepping stone towards buying a property or a way to give a little flexibility to someone’s living arrangements.
In terms of when you can move out of your rented property, the choice is yours! When you first move into the property, it’s likely that you’ll have a minimum tenancy period, which is usually a year. After this is over, you can choose to carry on living within the property or move out.
This is a little difficult when you are owning a property as you have to go through the process of selling your home. Also, remember that you may be searching for one too! If you get a little overwhelmed with the stress of moving home in Newcastle, feel free to get in touch with a mortgage broker in Newcastle like us.
As a tenant, your landlord should hold responsibility for all significant repairs. Some landlords will be better at this than others, however, sometimes you’ll find that you have to maintain the property yourself without their help.
Remember that when you own a property, you are accountable for all of the repairs and damages and you’ll have to sort them out yourself.
When choosing between buying or renting, make sure that you pick the option that’s best for you. You should consider both your personal and financial situation prior to making a decision. Here are a couple of things that you should think about:
If you need any help or any sort of advice when it comes to buying or moving home in Newcastle, feel free to get in touch. Our team have helped thousands of homebuyers achieve their goal in the past and you could be next.
We are available 7 days a week, so call or contact us at a time that best suits you.