To buy or rent? – that is the question
It’s often suggested that renting is the best option available to people looking for a home, but in fact, this is rarely the case.
Outside the super-inflated London and Home Counties markets, buying a new home is more affordable than many people realise. Indeed, recent research has indicated it’s by far the most sensible long-term financial approach.
Here in 2018, there are plenty of reasons why buying a property is preferable to renting one:
- Mortgage interest rates are at historically low levels. Although the Bank of England is expected to raise its headline interest rate later this year, taking out a fixed-term mortgage now will ensure several years of reassuringly low monthly repayments.
- When you take out a repayment mortgage, every monthly contribution brings you slightly closer to owning your home outright and being mortgage-free. However, you’ll always have to make monthly payments to remain in a rented property.
- According to an annual study from Bank of Scotland, average mortgage payments in Scotland are £103 lower than monthly rental fees for comparable properties. Over the course of a 25-year mortgage, a typical first-time buyer could save £31,000 by not renting.
- House prices in Scotland are still comparatively low. According to figures from Nationwide, they increased by just 2.6 per cent in 2017. The average Scottish dwelling costs £146,578 – only Northern Ireland and Northern England are more affordable.
While the above factors apply to any purchased house or flat, new-build homes offer an additional set of financial advantages:
- The Help to Buy (Scotland) scheme assists first-time buyers with their deposits. If you can cover 85% of a property’s purchase price with a deposit and mortgage, you could receive assistance with the other 15% on most new homes, currently up to £200,000.
- New-build homes feature the latest kitchen appliances and sanitary ware, with up-to-date electrics and plumbing. You shouldn’t need to replace or repair anything for years, and your property is covered by the builder’s warranty plus a 10-year NHBC policy.
- New homes are incredibly energy efficient, making every pound spent on gas or electricity stretch further than it would in an older property. Standard features like loft insulation and double glazing keep you warm in winter – and cool in summer.
The financial arguments in favour of buying a property aren’t the only benefits to consider. You can customise a privately owned home in any way you want – upgrading its fixtures and fittings, adding an extension or turning the spare bedroom into an office. In a rental house, you might not even be able to repair a faulty appliance without the landlord’s written permission. There’s no point fitting solar panels or landscaping the garden if you might have to leave in a month’s time, whereas a purchased home is yours for life. It can evolve as your circumstances change – and if you ever want to move, you’re already on the property ladder…Back to Latest Posts