The Pring Perspective “It’s just money down the drain”!
- Credit: Archant
ESTATE agent Stephen Pring, who owns independent estate agency Pring & Co, gives his Pring Perspective on why he believes it is always better to buy than rent.
You know that moment when someone says something and although you’ve known it all along, the truth of what they say hits you the moment they say it? I’d like to share a particular moment with you which crystallised for me why it is always better to buy than rent, if at all possible.
I was on a viewing with a couple in their late 20’s who have been in rented accommodation for a year. They had sold their property and moved into a rented property while they were thinking about where to buy. As we all know, the interest rates on savings is pitiful and there’s no doubt that house prices have been rising over the last year.
The couple remarked: “We’ve watched house prices creep up over the last year since we sold our house and we’ve been paying £850 a month in rent. That’s over £10,000 towards our landlord’s mortgage instead of our own! Mortgage rates are really low and have been for years and the money from the sale of our house is sat in the bank earning virtually no interest. The property market might go up and down but in the end, we could have paid £10,000 towards OUR OWN home and not paid for someone else’s”!
When it’s said like that, it just hits you doesn’t it?
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Of course, not everyone can afford to buy but if you can, it just makes complete financial sense – especially long term. If this couple continue to rent for four or five years, that’s £40,000 - £50,000 of their money paying off someone else’s mortgage.
It’s not rocket science. The basic laws of supply and demand apply as always and the property market will go through peaks and troughs. However, the longer you own a home, the better your investment by and large. Just ask your parents what they paid for their house and what it is worth now!
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It makes perfect sense to live in and enjoy the fruits of your biggest financial outlay each month and know that in the end, you own it outright and that you are not paying for your landlord’s pension. It’s YOUR tangible asset as well as a home and you are able to enjoy your inheritance and investment at the same time!
The alternative would be to entrust your financial security and inheritance to the banks, share dealers and pension schemes where values can literally disappear overnight. I know which path I recommend to follow and it takes me straight to my front door!
If you are looking to sell or buy give Stephen Pring a call on 01275 880550. Visit www.pringhomes.co.uk