Many people refer to the money they pay every month when renting a property as “dead money”, however I do not necessarily agree with this. Having a roof over your head whether you rent or you own your home is a necessity, just as the money is that we spend on clothes and food.
I will always support the idea of renting before you buy, as I believe it gives you the halfway house experience of being responsible for running a home but when something goes wrong you don’t have the financial burden of having to pay the big costs. For example when I rented a flat the heating didn’t work very well, so all I had to do is call my landlord and this was sorted with no expense to myself. However I recently purchased my own home unaware of the state of the central heating (not my area of expertise) and therefore I had to replace the boiler immediately, get the plumbing under the house replaced and a couple of new radiators. A few thousand pounds later I have a warm house but empty pockets and summer holiday plans have been cancelled.
As well as the benefit of not having to foot these big home owner costs, I believe everyone who plans to enter into a mortgage contract with their partner should have some prior experience of living together. It is a whole new experience when you start living with someone and it can put pressure on some relationships. The honeymoon period will be over soon when you start to pick up on the bad habits that didn’t quite surface over your romantic meals for two and cinema dates.
By renting first you can find your comfort zone with each other and learn how to co-ordinate your finances, which can be a big deal for some people. One of the main causes of arguments is about money, so getting over the awkward “who pays what?” by renting first, can put you in a much better position when you get to the bigger commitment of legally owning a property together.
Owning your own home has become a social aspiration for most people in the UK, and in the long term it is best to purchase your home if you can afford it. For first time buyers renting can give you a much more “eyes open” approach when you do get to purchase your home. It gives you an idea of how much your utility bills will cost however when you own your home there will be additional costs to consider such as; buildings insurance which is a legal requirement if your property is mortgaged and life and critical illness insurance which I would always recommend you take out to protect yourself and family. As well as this initially you will have solicitors fees, moving fees, a deposit to put down and money to furnish your house and rainy day monies to fund any problems that arise with your new property.
When you are ready to make the big step it is always best to seek independent financial advice, so you can be sure you are getting the mortgage that is best suited for you.
Sammy McCann BSc Hons, Cert CII (MP)
25th April 2016
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