It seems as though everyone around us is saving for their first house deposit and desperate to get on the property ladder, but whilst we are still saving, we aren't in a rush to move on joint to home ownership. Disclaimer: I bought my first house aged 18 and it is 200 miles away. I lived in it as a student and it is currently rented out and isn't somewhere we are considering moving to.
1 – The cost of a mortgage
A mortgage would cost more than double the rent we currently pay. We have been extremely lucky to find an affordable home together and our landlord hasn't increased the price in the 3+ years we have been living here. Even if the rent increased by 10% it would still be extremely affordable. A mortgage for a smaller house in the same village, paying a 20% deposit, will cost us at least double our current rent.
Jenni from Can't Swing a Cat has written about some of the additional costs that come with buying your first home.
2 – Rent is a fixed price
Our rent is a fixed fee – our landlord could put it up once a year, but that's the worst it can get. That means that when items break, fences fall down or the boiler stops working, we don't have to pay extra to get those fixed. If we took on a mortgage at a cost that is double our rent, and we had to pay for any repairs then our budget would be stretched to the point where we would have to consider some serious cut backs.
Knowing how much our rent costs every month helps us to budget accordingly! Other expenses could still crop up, such as car repairs, but we can budget for those more easily knowing that our housing is fixed fee.
3 – We love our house!
When we first moved in together we had only been dating a few months and so we decided to have separate bedrooms, and it worked for us! We've got a lovely three bedroomed cottage with off road parking and a garden. It means that we can have an office and a spare room, and if we decide to grow our family then there is space for us to grow into. The house isn't perfect – the carpets are cheap, the living room is extremely dark and the bathroom needs a good gutting, but we still love it. It is our home.
4 – Self-employment
We've both just gone self employed, and whilst we debated continuing to work for a year or so to get a mortgage, we realised that we wanted the self employed lifestyle without the stress of covering a mortgage that is double the cost of our rent! Plus, being self employed means that you need to have proof of your earnings over a number of years as well as a higher deposit.
5 – Flexibility
We get some flexibility with renting. If we needed to move for whatever reason, we could give two months notice and be on our way. Of course this works the other way, and our landlord could give us two months notice to leave, which is why we have saved enough money for a deposit, application fees and moving costs, just in case.
For now, we are happy to continue saving for a house deposit regularly, but we aren't in any rush to get onto the property ladder together any time soon! If we lived in an area where rents were high then I am sure we would be saving every spare penny we can!
Do you rent or own a property? Which is your preference?