To ask who chooses to pay rent rather than buy?

(227 Posts)
fluffiphlox Thu 24-Jan-13 11:13:00

I am laid up at the moment and resorting to watching Homes under the Hammer etc. My query is who the dickens is choosing to pay £500 plus per month (some rentals are £1200+). Isn't this more than a mortgage? I'd be interested to know who renters are and why? Most of the properties are family homes rather than student lets etc so why would a 'grown up' choose to give their money to a landlord rather than service a mortgage?

ClaraBean Thu 24-Jan-13 11:24:41

We live in a very expensive part of Britain, was born here, and I made dh move here when we got together grin
We both have reasonably good jobs, but there is no way we could afford to buy anything half decent in my home town. No way at all. The houses around the corner from us are 750000 +
We have decided to rent, unless we get a massive windfall.
We only rent from private landlords, who are looking for long term tenants, and who are happy for us to make the house 'ours', paint walls, make changes. We pay £1150 a month rent, but we love the fact we are not responsible for anything that goes wrong with the property, we have a very hands off landlord who leaves us to it, unless we call him.
I would find it very difficult to rent from a landlord who wouldn't let us paint the walls and was popping in every minute.
Of course owning our own home would be ideal, but it really isn't a massive deal that we don't. I don't feel the need to own a home. It is not a big deal for us.
If the money landed in our lap, we would buy, but we don't want to be indebted to a bank with a mortgage, much prefer to have a debt free life. If we need to move, we move, we are free (imo)

We currently do both not through choice.

The house we currently live in we rent.. we've been renting for the last few months. We're trying to sell our old house - we're only NOW after several years of massive overpayments on the mortgage at a point where we are out of negative equity and could afford to sell the tiny house we've long since outgrown, and finally leave the area we'd been desperate to leave for years.

Given we live in the south east and have three DC there's no way we have the money for a deposit on a new place so renting was the only way we could move. We'll need to rent for the next few years (probably an awful lot more) at least until we've saved up as a bare minimum a 10% deposit for a new one. Thanks to the boom and subsequent crash it's taken us this long just to get back to square one.

Renting is great, if you have a good landlord. It can also be very restrictive. I would always choose to buy if I could afford it but can see why others would choose to rent.

Loa Thu 24-Jan-13 11:26:30

We spent a lot of money on the upkeep of the property - windows, wiring, boilers and it took about years before we paid less in mortgage repayments than we could rent similar for -that was a repayment morguage.

Plus property is now worth less then we paid for it.

InTheNightGarden Thu 24-Jan-13 11:26:47

Because there's no other choice!

We are in our twenties, would love to buy a house and would MUCH MUCH MUCH rather pay a mortgage than rent but we don't have the money for a deposit on a mortgage and saving doesn't happen with a young child!

Realistically, but sadly.... we won't be able to have a mortgage unless we win the lottery (better start doing it!) Or we inherite anything.

baffledbb Thu 24-Jan-13 11:27:47

Well I've just bought the house that I've been renting since early 2009. In that time the price of the house has reduced by alot more than the rent I paid. I would have quite happily continued renting but the landlord wanted to sell and I didn't want the hassle of moving. In my case the rent was anything but "dead money"

Catriona100 Thu 24-Jan-13 11:28:04

1. people who have to move area but haven't got their house sold, or have their money tied up in some other way
2. those who think the property market will fall
3. those who are saving up for their ideal property
4. parents who are trying to get their child into a particular school (catchment area)
4. those who want to try out a new area before committing
5. those who are on a relocation package

notnagging Thu 24-Jan-13 11:28:12

I didn't think you were serious? A deposit is at least 20% can be up to 40%. Alot of everyday people can't lay their hands on that.
Also if you are paying interest only you are effectively only renting from the bank anyway.

Catriona100 Thu 24-Jan-13 11:29:37

But your supposition is right IMO, buying is preferable to renting because you can at least decide what colour your front door should be and where you can hang pictures.

FrustratedSycamoresRocks Thu 24-Jan-13 11:30:04

Ooh don't I feel judged. I'm not sure I can handle the shame of renting.

OP perhaps you could speak to my bank manager and get him to give me a 95% mortgage and then I could afford to buy a shitty little flat, rather than renting the lovely 3bed house with garden that I can afford and have lived in for the past 5 years.

Oh ps, I'm also a "grown-up" don't you know.

Tiggles Thu 24-Jan-13 11:30:37

We rent because it took 4 years to sell our old house having moved to a new area. During that time we used all our savings to pay the mortgage/council tax on old house whilst paying rent in new house. On selling house we made no money on it so now have no deposit. To buy a £100k house (even on our local council estate a 2 bed is £160k) we will need to save at least a £20k deposit, which is more than my annual take home pay, so it could be a long time.
YABU to think people can just go and 'buy a house'

ethelb Thu 24-Jan-13 11:30:40

"I why would a 'grown up' choose to give their money to a landlord rather than service a mortgage?"

This attitude is quite offensive tbh.

Here's some maths for you. I pay £1350 rent pcm. Average deposit needed in my area is £70K. I earn £25K.

fluffiphlox Thu 24-Jan-13 11:30:49

Thank you for the responses. As I say I'm out of touch with house buying and haven't rented for about thirty years. So if things are so difficult, the question might then be why are houses so expensive? What is supporting the price? Someone must be buying them. It seems totally contradictory to me. Just thinking aloud really, didn't expect the sarcasm from me or two posters.

showtunesgirl Thu 24-Jan-13 11:31:32

Because I don't have £40-70k up my sleeve for a 25-40% deposit.

Loa Thu 24-Jan-13 11:31:52

I don't know Catriona100 - we spent the last few years painting the house in nutural colours as we've known due to work we'd need to move at some point.

Loa Thu 24-Jan-13 11:35:05

What is supporting the price? Someone must be buying them. It seems totally contradictory to me.

Not enough houses round - they don't build enough.

Buy to lets.

Folk like us who spend years and years saving and do without - some have inheritance.

It does get galling when older folk talk of our generation spending money on fancy gadgets and other frivolous stuff.

RhinotheHamster Thu 24-Jan-13 11:35:21

your figures don't add up IME, OP. with even a 15% deposit, the monthly repayments on something even just big enough for our family, in town, would be £750ish.

so we pay 675 rent for a much bigger house, in a beautiful village location, where property maintenance is our landlord's problem. we have also been able to move house easily, at short notice.

I owned my first property at 21 when 100% mortgages were available and it was cheaper than renting. but while we are establishing our family, renting has certainly been a sensible option. less stress and a better quality of life. we are saving to buy again when I am back at work etc.

TroublesomeEx Thu 24-Jan-13 11:35:45

Why are houses so expensive? What is supporting the price? Where have you been living for the past 10/12 years?!!!

Unregulated lending; 125% mortgages; total faith in house prices only ever going up giving rise to unwarranted confidence...

Gordon Brown screwing around with the pensions which meant that people put their money into 'bricks and mortar' rather than pensions.

When people started thinking of homes in terms of property and investment.

3monkeys3 Thu 24-Jan-13 11:35:55

We have a mortgage but wouldn't be able to get a mortgage on our house now - raising a big enough deposit is a huge stumbling block for many people, it is much more difficult to buy now than it was a few years ago. Incidentally, it would cost is roughly £300 PCM more to rent an equivalent house so you're not necessarily wrong on that matter, but many people have no choice but to rent.

Catriona100 Thu 24-Jan-13 11:36:10

houses are expensive because a place to live in a basic necessity. If you have 100 houses and 105 different combinations of people lookign for a roof over their heads then the 100 who are willing to pay the most are going to get the properties and the other 5 are going to do everything in their power to up their budgets for when something else becomes available.

Comparing the world now to that of 30 eyars ago, think how many families now have 2 divorced parents each with their own space. or how many grown up children live and work away from home. Or how many new people live in Britain.

chewingguminmyhair Thu 24-Jan-13 11:36:51

Deposit on a three bed in my part of town is £80,000 minimum.

fluffiphlox Thu 24-Jan-13 11:36:56

I'm not judging . As I mentioned, I meant 'grown up' as opposed to student.

I've found the answers interesting and informative.

I had no idea that such a hefty deposit was required.

MolotovCocktail Thu 24-Jan-13 11:38:06

Us too - house prices here are at least £200k. We'd need at least a 10% deposit, so would need to save £20k. Even with a 95% mortgage, we'd still need to save £10k.

I'd love to buy; we'd have so much more choice and wouldn't be at the whim of a landlord. I could make the house my own in terms of decor, we'd have equity that out children would eventually inherit ... <sighs>

Most landlords we've had have been fine, but as renting is in increasing demand because thousands of people are in our situation (and other reasons mentioned above), landlords seem to be making more stipulations - where we are at least. We're looking to move as we need a larger property and it's more difficult now that it was when we last moved 5 years ago.

Keep dreaming, Molotov, cuz you're gonna be renting for many years yet.

poppy283 Thu 24-Jan-13 11:38:51

Do you not hear/read about current affairs at all op? It's been an ongoing story for quite a while,and not just on homes under the hammer, on the news

Catriona100 Thu 24-Jan-13 11:40:02

Loa - we rent too. Our previous landlord had a history of pretending horror at any minor change the tenants before us made and taking lumps of the deposit to reinstate the property. So, we learned from their experience that if a bedroom has lime green walls and a purple ceiling, you either get agreement beforehand for the change or pay up and put up with it.

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