It is perhaps understandable why potential buyers have a tendency to shy away from renting as an option for securing property, preferring to have an investment. Purchase is made yet more attractive in current times as rent these days is higher than a mortgage would be on an equivalent property. However there are many reasons why a person might consider renting, rather than purchasing a property, some of which are outlined below.
Financial Implications
Even with assorted schemes designed to make it easier for buyers to get a foot on the property ladder, a decent deposit is usually required to purchase a house, flat, or other property. In addition, prospective buyers will need to convince a bank to lend the remainder, and this is getting more difficult as banks are being reluctant to lend. A mortgage is a huge commitment; if payments are not made on time then a property owner could be in danger of losing their home.
Interest-only mortgages are increasingly rare, and so a large deposit is the best way to keep mortgage payments to a minimum. Renting, on the other hand, will only require an advance of a number of months, which will usually be a lot less money than a down-payment for a mortgage on a similar property. Furthermore, major improvements needing to be made to a rented property will often be completed at the expense of the landlord, rather than the tenants.
Long term vs. short term
Purchasing a property is indisputably a long term commitment. Renting will usually offer greater flexibility in duration of stay. Minimum terms will apply to any rented property, and notice to be given before the lease ends, and this ensures a tenant will have sufficient control over their duration of stay. Selling and buying properties, on the other hand, can be processes of unpredictable stretches of time.
If a person is looking for short term accommodation, for example for a temporary job, a short lease with predictable cost is a more ideal resolution than purchasing a property. For individuals who are not intending to settle in one location, perhaps because they are planning to travel, renting is also a more sensible solution.
Range of Properties
It can often be easier to find properties to rent than to purchase in some select areas, for example in city centres. Renting can therefore create more options in terms of size and location of available properties. In the instance that a large down payment for purchase is not achievable, or perhaps a satisfactory mortgage is not agreed, then a greater value property can be obtained by renting. Shorter leases can also enable tenants to experience the property and perhaps get a feel for the area before making a decision about whether the location is suitable.
There may be other reasons why each individual might prefer to rent; it ought not to be excluded as an option when searching for property.
This article has been written by Brandon Barnes, an enthusiastic property blogger from the UK, on behalf of property search portal Rhodium. Visit the website on http://rh-45.com/en/properties/map for more information.
