Purchases vs LeasingWhen you are looking to move into a new home, one of the first decisions that you need to make is whether you want to purchase or lease a property. Each has a number of distinct advantages and disadvantages, so it is important to consider everything before making your decision.
Here we will take a look at a few of the reasons why you should consider leasing over purchasing in some cases.
To purchase a property you will need to raise a fairly large amount of capital to handle issues like the deposit, legal fees and any money charged by your estate agent. Saving for these fees is often a long term process, with many people taking a number of years to build up the money required to actually make a purchase.
By contrast, when you lease a property you will usually only be required to pay a deposit alongside a month's rent in advance. This sum is invariably smaller than the amount that you need to save to make a purchase, which means that leasing is an excellent option for people who are looking to move as quickly as possible, for whatever reason.
When you purchase a property, you will be required to carry out any repairs and maintenance yourself. This can be an enormous drain on resources, particularly if your budget is such that you will struggle to make mortgage payments if something goes wrong with the house.
However, with leasing the general maintenance of the building and its facilities is less of an issue. Though you will often have to wait a little while to get an issue resolved, your responsibility lies in letting the owner of the building know about any issues that you are experiencing. It is then an issue that they will have to deal with in order to ensure they are offering the living conditions that were promised to you.
Once you have agreed to purchase a home you will be tied into paying for that property for as long as it takes to pay off the loan you have taken out for it. You have the option to sell, of course, but this is a long-winded process than can often take months, if not years.
When you lease a property you have much more flexibility, particularly if you are on a rolling monthly contract. This means that you are free to move on whenever you want, as long as you give the required notice as specified in the lease agreement.
The Property Market
When you lease a property you will not need to worry about fluctuations in the property market having an effect on the overall value of your home, as you do not own it. Instead, all you need to be concerned with is making the rent payments when they are due.
This can be excellent for those who want to dip their toes into the property market and experience living on their own for the first time, without worrying about the burden of responsibility that owning a property carries