Benefits of Buying a Home

There is little doubt that choosing to buy a home is a big commitment. For the majority of people their home will comfortably be the most expensive thing they will ever buy. The system of buying property can also be stressful and involve a long drawn out process. However despite this owning property does have a number of advantages which is why in the UK the majority of people prefer to buy rather than rent a home.

One major advantage of buying rather than renting a home is greater security. Renting is often seen as a temporary measure although some people will choose to rent over a longer period. The disadvantage of renting over a long period of time is that since the home is not yours you can be affected by the needs of other people. For example you may be asked to move out at relatively short notice if the landlord decides they want to sell the property or if they no longer want to rent it out. Rent payments may also be increased at short notice to an unaffordable level.

Therefore people choosing to rent may find that they have to move home every year or even more often than that. Along with the inconvenience of actually moving, changing homes on a regular basis can make it harder for people to settle and make long term plans.

Choosing to buy rather than rent also has a number of financial benefits. Buying a home can be seen as long term investment. Many people will aim to have paid off their mortgage before they retire meaning that when they do retire they are essentially living ‘rent free’. In the post war period property prices have risen at a faster rate than inflation meaning that buying property can offer a greater capital return than building society interest rates and share prices.

A further financial benefit is that the value of the home can be used to take out secured loans. Owning your own home gives you access to loans often a better rate of interest as lenders consider secured loans to be less risky. Some homeowners may also choose to remortgage their property and withdraw equity from the value of their home. Having the option to remortgage can offer a better alternative to taking out a loan.

Homeowners also benefit from being able to maintain their home exactly how they want it. People renting a property are unlikely to have much say in the way the home is decorated. Landlords may also enforce certain rules such as no pets or keeping the home to a level of cleanliness. By owning their home people have greater freedom to make the property really feel like home rather than just somewhere they happen to live.(By Rich Bendall)