Most of us are lucky enough to live in a home but some of us will own that home and some of us will rent. In the past governments have encouraged us to own our own homes and that has lead to a culture where most people desire to own the home that they live in. This does have advantages, but there are also disadvantages as well. It is worth understanding both before you make a decision to buy a home or to sell your home and return to renting.
Advantages of owning a home
Owning a home means that you have somewhere secure to live that you will not have to move away from unless you are unable to pay the mortgage. When you rent you tend not to have this sort of security as even if you are able to pay your rent, you will still be at risk of being given your notice if your landlord decides to sell the property. There is also a risk that your rent to be put up to a level that is no longer affordable for you, so you are forced to leave.
Owning your home also allows you more freedom with want you can do with it. You can decorate it how you wish, which may not be allowed when renting and you can do restoration and repairs. You can change fixtures and fittings and make the home your own. If you want a bigger home you can expand it rather than having to move.
When you buy a home you tie up money in it which can be released when it is sold. When you rent a home the money you pay all goes to the land lord and you cannot get anything back. You home should increase in value over the years you live in it and if you own it, that value increase will go to you, once the home is sold. Although, while you want to own your own home, you will not be able to access the money tied up in it, you do always have the option of selling it to release the money. Many people choose not to do this but let their children get the money when they inherit.
Advantages of renting a home
If you rent a home you will have more flexibility to move. If you tend to move around the country for work or do not like to tie yourself down to living in one place then renting is better as you will not have to sell a home frequently. You may also not know an area well and if this is the case it is wise to rent for a while before thinking about buying so you know more about the local area first.
If anything goes wring with the house or fixtures and fittings then the landlord has to fix them. This is everything form a roof repair to a boiler service. This means that the tenant will save money by not having to pay for these things themselves. They will not even have to pay for decorating, although some choose to because they want to brighten up their home.
When you buy a home you will normally have to take out a mortgage. This is a loan with a big commitment. You will normally have to repay it over twenty-five to thirty years, which is a long time. It is really important to make sure that you are able to repay the loan over the whole period or else you risk losing your home. This would be recorded on your credit record and so it could be hard for you even to find a property to let as landlords like to do a credit check first.
As you can see, there are advantages and disadvantages. It is worth thinking about whether these will apply to you or not. It might be that you want to settle somewhere and that you are confident that you will be able to repay a mortgage or it might be that you think you will be moving around a lot and are not sure whether you would have a secure income to pay a mortgage. There are also very personal reasons for wanting to own or rent a home, perhaps due to family traditions or things like this that you would need to consider.
Once you commit to buying it is difficult to back out as you will need to sell your home. This is not always easy as it depends on the housing market. The house may also lose some value initially and so you may not get back what you paid for it. Moving is also expensive and you will need to pay solicitor and removal fees and these will be costs that you will want to get back as well.
