There is no right or wrong answer to whether you should rent or buy. It comes down to personal circumstances and market conditions. Still, it's always a hotly-debated topic.
The case for and against both renting and buying can be easily made. But, fundamentally, the right solution depends on your lifestyle and personal circumstances.
Because I don't know what these are, I cannot say which option might suit you best. So instead, here are some things to consider when choosing either way:
1. You’re paying off an asset
If you pay for your home with a repayment mortgage (where you repay both the interest and the capital every month), you are getting ever-closer to owning it. This is preferable to your monthly repayments lining a landlord's pockets, which creates ‘dead money’. While the value of your property may go down as well as up, so long as you keep up with your mortgage repayments, at the end of the mortgage term you will own your home outright.
2. Interest rates are (currently) low
It won't always be the case, but for the last few years the Bank of England's interest rate has been at record lows which means the cost of mortgage repayments is low too. In many cases, when it comes to the monthly payments on a home, it is actually cheaper to own than to rent.
3. You are free to do what you like with your home
If you own your home you can do what you like with it (within planning regulations of course). This could mean adding a loft conversion or extension, or even just redecorating to an acquired taste. As the owner, you'll also be in direct control of any problems with the property, which can be easier than waiting for a landlord to sort them out.
4. You'll gain experience and a solid starting block
The house buying process can be daunting, but when you have done it once it's great preparation for the next time. And if you’re a first-time buyer, owning your first home can be a great way to kick-start financial planning for your future and help you to create a household budget to manage the costs of running a home.
5. You can be part of a community
An often overlooked advantage of buying a property is that, because you're more likely to stick around, you’re also more likely to become part of a community. This might centre around the local school, church, shops or even running club. Either way, it can culminate in lifelong friends and support.
1. You can be nomadic
Renting allows you to choose pretty much where you’d like to live – subject to budget! – and how long you want to be there. In most cases you can break a rental contract after 6 months, allowing you to move to a new location or perhaps just try one out as a test before you decide to commit and buy in the area.
2. House prices aren't your problem
As a renter you are not going to fall foul of any housing market-related conditions. You will of course have to pay monthly rent (which may go up once your existing rental contract has ended) but if house prices fall, you won't be trapped in a state of negative equity and unable to move.
3. You won't be billed for maintenance and repairs
As a tenant it is the responsibility of your landlord to maintain the property, pay for decoration and its upkeep. So if the boiler goes bust, while you might suffer in the short-term, at least in the long-term you won't have to pay for it.
4. You might not be in a position to buy
If you want to buy a house with a mortgage, lenders favour applicants who have been in permanent employment for at least three months and who have excellent credit histories with little or no debt. Even then, you may not qualify for the mortgage if your salary isn't high enough. A rental property is a little more easy to get a green light for (although you should still expect to undergo some checks).
5. It requires a lot less upfront cash
Renting usually means finding six week's rent upfront as a deposit. In some cases, you may also be charged an agent fee and for a credit check. But this is still a lot less than raising a deposit of at least 5% as well as finding other home-buying fees such as Stamp Duty which, alone, can run into thousands of pounds.
Some information contained herein may have changed since it was first published. Zoopla strongly advises you to seek current legal and/or financial advise from a qualified professional.