The following is a guest post by Amy Hart. Amy writes on a variety of topics; article writing definitely being her top hobby. Recently she is focusing on property topics, having just completed a move into her much-lusted after dream home!
It’s great to enjoy the element of flexibility that renting offers you but nothing really beats living in a place that you can truly call home.
Looking for a home to buy, and you can read here about Taylors, who could help with that search, is the first step on your path to making that transition from renter to buyer. Here are some tips and suggestions on how to achieve a smooth adjustment to homeownership.
The financial difference is one of many advantages
Renting can often feel like you are wasting money that could be going towards a property that you get to own outright when you have paid off the mortgage, and according to a recent survey by high street bank Barclays, the savings could run into hundreds of thousands.
The bank estimated that if you compared the cost of owning your own home over a fifty-year period, against the cost of renting, with aspects like maintenance in the equation, you would be over £190,000 better off as an owner.
Renting might win the short-term financial argument in some respects but as you will always need a roof over your head and it is therefore better to take a longer term view, being a homeowner seems to be a bit of a financial no-brainer.
A greater sense of security
If you needed any further persuasion regarding the argument in favour of buying rather than renting, another positive factor is the greater sense of security that you may experience.
It is not just a case of putting down roots and being able to make plans knowing that the house is yours as long as you keep up the mortgage payments, it is also the progression in your credit standing from tenant to homeowner.
This is certainly one factor that sometimes get overlooked but definitely has relevance.
Owning your own home can improve your credit standing and when you have a property with equity available, this can give you an element of bargaining power for better deals and lines of credit, that are not always available if you are a renter.
Experiencing the difference
Becoming a homeowner can take a bit of getting used to, as some things change the minute your name goes on the title deeds and you officially become a property owner.
One aspect of this transition that can be a bit challenging to adjust to, is the fact that if anything goes wrong with an appliance in the property or any repairs or maintenance tasks are required, it is no longer a case of calling the landlord or the letting agent in order to get it done.
You will have to pick up the bill for any of these expenses, so be prepared to think like a homeowner and anticipate any potential problems by scheduling regular maintenance. Also think about setting up an emergency fund that gives you access to some money in a hurry, if you need to get the boiler repaired or an electrical fault needs fixing urgently.
There are a number of fundamental and sometimes subtle differences between being a tenant and owning your own home, so it is simply a case of being prepared for these changes and understanding how your role has changed.
Get your insurance sorted
Another noticeable aspect of becoming a homeowner is the difference it makes to your insurance requirements.
As a tenant, you will presumably have arranged insurance to cover the prospect of your personal belongings being damaged or stolen in the property that you are renting.
When you become the owner of a property, you immediately become responsible for insuring the building itself as well as your possessions. Buildings insurance is designed to insure against potential problems with the building, structural or otherwise, that will need to be paid for.
If you have a mortgage, your lender will insist that you have a valid building insurance policy which covers the rebuild cost of the property should disaster strike. For a personal perspective, buildings insurance will also mean that you take out cover so that if your home is flooded by a burst pipe for instance, the insurance cover will allow you to be able to claim for the majority of any expenses incurred in putting this right.
Buildings insurance can often be combined with a contents policy, so that you are covered for most eventualities.
Once you get to know all of the main aspects of homeownership and the differences you face compared to renting, it shouldn’t take you long to make a reasonably smooth transition.