Would you move into the most expensive rental you can afford?

[blackshoepolish]

We need to move flats. We aren’t ready to buy yet so that’s not an option being considered (already have most of a deposit).

We are considering between two flats.
Flat A) £2,300 a month is big enough and nice but probably wouldn’t be happy there long term.
Flat B) £2,950 a month, is huge, has a separate study and is somewhere I think we’d be happy until we buy.

Flat B is the maximum we’d be comfortable paying in rent. Our take home pay is roughly £7,500 a month. Next year, our income will increase to about £11,500 a month take home (dp qualifies as a lawyer).

No, I'd go for Flat A (although that's expensive enough, presumably you're in a major city) and put more towards a deposit - you might have 'most of a deposit', but having a bigger one is never going to hurt.

Even if you think you’d probably have to up sticks and move again?

No I only go for the most expensive I can afford when I buy.

When I've rented I've chosen the cheapest suitable property.

I'd go for Flat B.

Personally I would go for the cheaper flat and put the extra into savings for a deposit . And I would stay there (landlord permitting) until I could afford to buy.

I'd go for the cheapest flat.

If right now you pay the max you are comfortable with, what happens if they put the rent up even higher and it's more than you can stretch to?

Also, why throw away £650 a month when you could be putting that towards having your deposit sooner?

When I’m signing up to a regular payment, I never spend the most I can afford. I was brought up to never leave myself open to being overstretched financially.

So I leave a good amount of wiggle room for if other unexpected costs arise or your income drops for a period. It’s like an insurance policy but I’m not paying anyone for it, just benefitting in terms of peace of mind.

My feelings exactly. Put the difference in costs the flats into an ISA or similar. 🌹

Rents are expected to go up hugely in the next few years. You will be better managing on the cheaper rent until you buy rather than moving again too

Having rented for about 10 years, most of which in London, I'd go for flat A. You can't ever bank on being in a private rental long term! You have no control over how long you'll be there. We lived in plenty of flats/houses we'd have been happy in long-term but the landlord either decided to put the rent up by a huge amount, or they wanted the place back (in one case because they were moving back from abroad).
Plus money spent on rent is just a complete waste of money; you'd be better off investing that £650 a month into an ISA or stocks/shares and reap the benefits when you retire.

But surely everyone can get cheaper? I could move to the back of beyond to save money, but doesn’t mean I want to. London in 2024 is very different to London in 2020 or other areas of the UK. Appreciate your views though!

Cheapest.

What is the point in paying higher rent? It is lost money, not something you are investing in. Surely both flats are temporary measures so why do either need to be better than the other? Your aim is to buy a property, so rent the less desirable cheaper flat so you can move out quicker.

With renting when you intend to buy, focusing on your capacity to save is paramount. Flat A gets my vote for this reason.

Yeah, it's a waste. Save the money to buy the house you really like .

It sounds like you wanted us to give a certain answer and we disappointed you by giving another.

£650 a month is £7800 in a year.
So depends how much you value the extra space.

I agree with everyone else- cheaper flat and save the money for your deposit.

Already have most of a deposit as mentioned - already own a £350k flat

I’m with Twiglets - it doesn’t mean I’d settle for something too far out or too cramped / scruffy but I wouldn’t go all out on a high end rental. We rented before buying last year, I wouldn’t have wanted to rent something that was nicer than we could afford to buy even if we could have afforded it in the short term.

Rent as cheaply as you can, save as hard as possible

I am in London too, our take home is £7000 and would be £7400 once DH finishes paying his student loan only 3k left on it). Our current mortgage is 1k, it will rise to £1250. Looking to move to a nicer flat but very unwilling to pay more than 2k mortgage per month as i think thats the max we can afford without compromising our future options.

In fact I am even thinking i would want to stay in our current flat and stick to paying £1250 until we get new jobs and a pay rise. So i would go for flat A

We don't have a car and DH cycles to work.

Does it matter if you would be happy to stay there longer, if rent increases 5% or so a year?

I'm being completely unhelpful but chuckling about having £11.5k a month. I don't get that a year!

But, I'd go for the cheaper option. Save harder and then buy a place instead of renting.

Go with the home that makes you happiest to be in.

I cannot tell you the number of times the OH and I have almost bought houses that really wouldn't suit us out of sheer desperation to get out of a rental (which also isn't cheap, but not London £) that drives us borderline insane.

We've forced ourselves to stay for another year and more than doubled what's in our savings, but every single day, one of us loses our shit at yet another thing that has gone wrong, or another thing that has woken us up in the night (I was woken up six times on Weds night, on Thursday I threw all my toys out of the pram).

Home buying is a big decision. If you think you are likely to be a fussy, discerning buyer (we have very specific needs and I loathe new builds), put yourself in the rental that won't make you feel like you need to escape.

Obvs if you are not all that fussy and are likely to take a lot of what's being sold, go for the cheaper rental!

Another crucial deciding factor re: renting is - does the LL have a mortgage? Mine doesn't, and she hasn't put the rent up, and she gets stuff fixed within hours, not weeks. You can find that out by paying the land registry £3 and seeing if it has mortgage listed against it.

I agree. It's so important to love your home and enjoy spending time there. With a take home of £11.5k soon you can afford flat B and will mean you only buy somewhere when you really like it. We did similar and I'm so glad. I loved living in our rental, did lots of entertaining which I enjoy and only bought when the perfect place came up.