This month (January) saw an increase of 7.6% in the average asking price for a property, the highest annual rate of price growth recorded by Rightmove since May 2016 - equating to £341,019. With a distinct lack of affordability throughout the UK, renting has become the preferred option for a lot of people, with up to a third opting to rent in urban areas. So why do so many people choose to rent instead of buying a home? Today we’re going to
When saving for a home, usually you would need a sizeable deposit before even considering legal fees for solicitors etc. whereas when renting, it’s typically only a first month's rent paid in advance on top of 4-5 weeks worth of rent. While that may seem daunting, it’s a fraction of the typical mortgage. For example, if you wanted a £100,000 home, and were looking at a 10% deposit (most commonly used) you would need to save £10,000 as opposed to around a tenth of that for a deposit on renting (depending on area/size/market etc). This can also be made easier to manage through the use of Rental Property Management software.
Rather than signing up for a 25 year mortgage, Private Landlords often offer tenancies for as little as six months. So whether it’s your first time living alone and you want to see how you get on, or even wanting to test living with a partner or friend for the first time, this helps you to gain a good understanding without committing too heavily to anything. Not only that, but if you’re looking to move to a new area, or if you relocate a lot for work, renting is a great avenue to follow.
If you’ve ever looked at the housing market for an area such as London, you may have thought it wasn’t affordable, but with renting comes a cheaper price if you’re moving in with others to bring down the cost per person. This can then present options you hadn’t even possibly considered, or previously ruled out.
When renting a property, the ongoing costs of building maintenance, insurance and service charges are all usually covered by the Landlord. This makes it much easier to work out monthly costs, which is why it’s such a popular decision among the younger population who may be leaving home for the first time. Aside from this, it also gives you time to focus on other things, as you don’t have to waste time sourcing contractors for work etc. It also leaves less room for unexpected costs that you may have not budgeted for, such as a broken boiler.
When buying a home, there is usually quite a long process to go through - from finding a mortgage lender to communicating with solicitors. However once you’ve found a property you’d like to rent, it’s quite a simple process completed straight with the landlord or estate agent and can be done in a matter of weeks or months.
If the price on the property you’re renting goes down (or up) you more than likely wouldn’t hear anything about it. This means your monthly price probably isn’t going to change, and because you won’t have to sell anything when you leave, you won’t lose out as opposed to homeowners trying to sell. The selling process can be lengthy for some, and can often result in losing money due to the house market falling from when they originally purchased.
We appreciate you taking the time to read this blog, and hope it has provided you with an insight as to why renting might be a better option for you. If you are looking for a management software for renting, or are a landlord looking for a software to manage renters and contractors, be sure to check out our website or make use of our resource centre for more information.