Should I Rent or Buy in Sheffield?

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Why should I buy?

Risks of buying

Will a mortgage be cheaper than renting?

Mortgage Advice in Sheffield

We often have First Time Buyers in Sheffield considering their first move onto the property ladder as they ponder whether to buy a home or continue renting. According to a recent survey by Halifax, 372,000 First Time Buyers got onto the property ladder in 2018. This equates to a huge 50% of all house purchases with a mortgage. You would have to go way back to 1995 for a time when First Time Buyers accounted for a larger share of the market. So the question for First Time Buyers is, “is buying better than renting?”.

When comparing renting to buying, the most common thing that you will hear is that renting is a waste of money. People say that it is always better to own a house rather than to rent one; but is that statement always true? In fact, times have changed and it’s now a lot more common for people to rent.

As an expert Mortgage Broker in Sheffield, we thought that with all of our mortgage experience we should talk about whether you should buy or rent a property.

Why should I buy?

The property market has been riding the same roller coaster for years now, it’s constantly up and down and changing course, you never know what’s next. So, if you buy a property and the market plummets, your property could down in value too.

Unfortunately, this has happened to thousands of homeowners over the years, although, history suggests that even if you buy at the very peak of the market as long as you can afford to keep the property eventually prices tend to go back up.

For example, during the credit crunch period sold values dipped. Before the coronavirus outbreak in 2020, this was one of the lowest economic periods of recent times. Surprisingly, less than a decade later these sell values shot up to a new all-time high, meaning that if you bought a property between 2005-2010, it was more than likely that your property value had increased. 

What we are trying to say is that if you invest in a property, in the future your sell price could increase which shows that it was worth buying over renting.

Risks of buying

On the other hand, you could lose money if you are forced to sell your home at the wrong time, for example, due to a relationship breakdown or a reduction in your income.

If you are worried about the risks when it comes to buying a home, talking all future possibilities with a Mortgage Advisor in Sheffield could put you at ease. Before committing to anything it’s also nice to know where the market is currently sitting. An expert Mortgage Broker in Sheffield like us are experts within the mortgage world and know what sort of deals you’ll be able to access based on the economy and your individual situation.

Buying a home is a huge financial commitment and you want to make sure that you get it right the first time. It also wants to be right for you, the most important factor is that it matches your circumstances.

Will a mortgage be cheaper than renting?

Despite people thinking the opposite, mortgage payments are usually cheaper than renting. Depending on the mortgage that you take out, your interest rate may fluctuate. If you don’t want the interest rate to change, a fixed-rate mortgage is probably your best option as your monthly payments will stick to the same amount every month.

When renting, you’ll usually find that your monthly payments stay the same. Sometimes your lender may increase your rent for one reason or another but it’s unlikely that they’ll ever reduce it.

Security

People often get a sense of security when they buy a home, and it’s understandable. No one can force you to move out of your home (assuming you keep up with your mortgage payments), whereas when you rent, if something goes wrong on the landlord’s end, they could ask you to move out.

Of course, you have some protection when it comes to renting and being asked to move out, there will always be a notice period. This is a disadvantage to renting, you are living in someone else’s property so if they want it back, there isn’t much that you can do. This is not ideal, especially if you have family or work nearby or you have children in a local school.

Sometimes landlords give their tenants the first refusal to buy the property if they are selling it so they can save on estate agents fees.

Flexibility

Renting can be more flexible than owning. When you want to leave the property, you can give your landlord notice anytime you want. This may be because of a job offer in another area or that you want to move somewhere else, etc.

This is more difficult when you are a homeowner as you will have to decide whether you want to keep your home and rent it out as a Buy to Let in Sheffield or sell it. The process of selling a home and buying a new one is time-consuming and expensive, so if you are considering going down this route, it may be best to get Mortgage Advice in Sheffield. Speaking to a Mortgage Advisor in Sheffield could take all of the stress off your back and it could allow you to access competitive mortgage rates.

If you think that you may not be around in a particular area for very long you should consider whether the property is worth buying. Buying somewhere should definitely be viewed as a long-term investment.

Repairs

As a tenant, your landlord should be responsible for any major repairs. There will always be some letting agents and landlords better than others, however, you are renting so you should expect to do some minor maintenance of the property yourself.

If you are a homeowner then all this is down to you, as is insuring the property which will be a condition of any mortgage you take out.

Despite what some people might say, owning a home is not for everyone. If you are a First Time Buyer applicant and haven’t had much mortgage experience, maybe you should consider renting first. Even if you are young and moving in with a partner for the first time, it may favour you to rent just in case the worst happens and things don’t work out. Getting a name removed from a mortgage can be tricky and complicated whereas if you are renting, it can be a much easier process as you can move out whenever you want.

Speak to a Mortgage Advisor in Sheffield

Before diving into the home buying world, it may be best to look at all of your options and find out which one is best suited to you first. Buying a home is a huge financial commitment, you need to be certain that this is right for you. If you decide to rent though it may take you much longer to save up for a deposit.

As a Mortgage Broker in Sheffield, we see that most applicants actually opt for buying over renting. People see getting a mortgage as an investment and they would much rather see their monthly payments going towards their own benefit rather than someone else’s. It’s sometimes just a case of getting your timing right and also being in the right financial position to be able to proceed.

To see what route could be best for you based on your personal circumstances, get in touch with your expert Mortgage Advisor in Sheffield. Sheffieldmoneyman will guide you through the whole renting/home buying process and provide our full help and guidance at all times. We have been doing this for 20 years now, we know exactly how to help you!

Date Last Edited: September 15, 2023