To rent or to buy? Which is better. Let’s discuss.
Advantages of renting
Many advantages of renting relate to lifestyle. There’s flexibility – you’re not tied down to living in one house, repairs are covered by the landlord and you don’t have to pay stamp duty every time you move!
It costs about 4% of the sale price of your home to sell (agents fees, advertising, etc) and about 6% of the purchase cost to buy (stamp duty, government fees, loan establishment fees, etc). When renting, you don’t pay any of these if you move.
In some cases, renting can be a cheaper alternative to buying – especially if you want to live “closer to the action”, like inner city areas. Many young people can’t afford to buy in these locations, but can afford to rent there.
Although rents continue to increase each year, monthly rental rates will often be lower than mortgage repayments.
Disadvantages of renting include:
The landlord calls the shots and each year, has the right to evict or ask you to move he may want to move in himself. Then there’s the regular property inspections and limitations on pets.
AS a tenant, you’re restricted in how you can “personalise” the property.
When renting, weekly rent payments never stop. While mortgages usually take over 20 years to pay off. Once they are paid off, this expense is removed and you remove the weekly financial burden.
The answer is….
There will never be a clean cut answer to renting v’s buying. Everyone’s personal situation, needs and preferences are different. However, regardless of your preference, there will always be a rental market.
How renting benefits first home buyers
We’ve noticed more first home buyers feel they are being pushed out of the market from rising house reprices. However, they are still entering the housing market – as investors. By making their first home an investment property, they can get their “foot in the door” of the property market, save more money and further establish themselves for later in life.
Some of their first time investors save by living at home with their parents, or enhance their lifestyle by renting in the areas they want to live – close to work, attractions and nightspots. To them, it’s a win/win.
How you can help a first home buyer
If you know someone who’s looking to buy their first home – as an investment property – please introduce them to us. We’re happy to provide a free, no obligation consultation to help them realise their goals!
If you have any questions email us: firstname.lastname@example.org
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