11th Nov 2022|Sales|Lettings|

Should I Buy Or Rent My Next Property?

With property prices rising for both buyers and renters, many of our clients have been wondering whether they should buy or rent their next property. However, purchasing your property remains the best option when compared to long-term renting thanks to the stability and economic benefits of property ownership. Better yet, buying a property is still cheaper in the long-term when compared to renting according to mortgage firm Revolution Brokers. Their research unveiled that the average cost of renting via the private sector is £1,143 per month, which far exceeds the average interest only mortgage repayments of £829 per month, making the latter option far more financially viable in the long-term. Even the average two and three-year fixed rate mortgages come in below £1,100 per month – in short, if you’re considering whether to buy or rent your next property, purchasing will likely be the most financially beneficial for you in the long run.

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What About Increasing Mortgage Rates?

But what impact will increasing mortgage rates have on your decision of whether to buy or rent? According to Revolution Brokers, even if mortgage rates soar to 6%, this will still be less expensive than renting if using interest only payments. Better yet, Rishi Sunak’s recent appointment as Prime Minister bodes well for the long-term stability of the economy – the pound has already bounced back to the value it held against the USD before Truss’ appointment, indicating a brighter future for the British economy, which is set to positively impact the property market.

The Benefits Of Buying

Buy To Let options

Even if you aren’t looking to settle down and move into a purchased property (for example, for fluctuating work commitments) it could still be beneficial for you to purchase a property as a buy to let unit. Landlord returns have increased by 18% over the past 12 months, providing a stable source of income for property owners by encouraging them to invest in one of the most reliable asset classes. What’s more, buy-to-let property owners can eventually move into their purchased unit in the future if desired, or use their rental yields to grow a portfolio sustainably.

Stability and Long-Term Price Growth

When renting, your money goes straight into the pockets of the landlord or property agency that manages your building. However, when you purchase your property, your funds can be seen as more of a long-term investment thanks to equity building: after all, your property purchase is likely to accrue value over time and the mortgage payments you make if you have a capital repayment mortgage will generate more equity to put towards a deposit for your next property, making it a particularly stable asset class for long-term financial gain and security. Furthermore, despite the economic and political instability of the past few months, the property market is set for stable growth over the next five years – JLL’s latest predictions suggest that each region of the UK will experience average price growth of at least 3% per year until 2027. In fact, JLL has predicted that Central London will experience 19.3% cumulative rise by 2027, and that major cities across England and Scotland will perform particularly well over the same period. As such, buyers can expect sustainable long-term price growth if they invest in the property market, even with periods of economic uncertainty.


High demand for property for buyers means that, in the event of a re-sale, it will likely take very little time to find a purchaser. This is due to a severe lack of supply for both rental and sale properties, which makes the property market fiercely competitive. This is why such ambitious New Homes schemes, such as Michael Gove’s pledge to build 300,000 new homes per year, are so important. However, considering the government’s inability to reach their new homes targets thus far, it is unlikely that demand will be eased in the short term – in fact, JLL has predicted that new supply may only peak at 200,000 new homes per year, which bodes well for those able to secure a home to purchase, as their unit will be in-demand if they choose to sell on.

No More Rental Deposits

Although purchasing a property sees many buyers use large amounts of their savings, they will undoubtedly save on costly rental deposits in the long-term. These can slowly accumulate, especially if you have moved multiple times, as you will likely be charged for minor damages at each property, and will need to outlay a deposit for each home you move to. At your own property, these rental deposits will not be applicable, and you can make minor maintenance amends at your leisure.

First-Time Buyer Options

We understand that getting onto the property ladder can be difficult, with a hefty initial deposit often required to secure a home. This is why it’s important to be aware of the multiple government-led schemes that can help you take you first step. Here are just a few of the options available for First Time Buyers in England:

  • First Homes Scheme: Allows first time buyers to buy selected new homes for a 30-50% discount
  • Right To Buy: Allows long-term renters the opportunity to own their home outright
  • Lifetime Individual Savings Account: Scheme which allows the government to contribute up to £1,000 per year to a person’s savings for a property or pension pot.
  • Shared Ownership: Scheme which lets buyers own a portion of their property, and rent the other portion

Looking To Buy Or Rent?

With the future of the property market looking bright for purchasers, there’s plenty of reason to start exploring your options with Centrick. Whether you’re looking for a stylish city centre apartment, or the perfect family home in the suburbs, we’re sure to have an option for every preference and lifestyle. For more information on how Centrick can help you start your property journey, or to make sense of whether you should buy or rent your next home, contact us via the link below:

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