Should I buy Or Rent?

Right now many people are wondering whether to buy or carry on renting.  The housing market has taken quite a knock recently but there are signs of house prices increasing and continuing to do so.  However you look at it at home will always be an investment, more importantly YOUR investment.  With every rental payment you make you are supporting some else’s investment.

It might more apt to ask whether or not you are in a position to buy right now.  Lenders in the UK are still focusing their attention on the 75% and below loan-to-value sector.  If you are a first time buyer looking to purchase your first property you are going to need a 10% deposit in order to secure a mortgage offer.  Even then there will not be many lenders to choose from.   Lenders are still unwilling to offer 95% products as they have done in the past  and the possibility of 100% mortgages seem a million miles away.

A 10% deposit is a large sum of money to put down when you consider the current average house price is £169042 (source: Halifax house price index 7th January 2010) and if house prices continue to increase it is only going to get harder. 

If house prices continue to rise as they have done over the last 5 months and lenders are able to offer more competitive products to a wider loan to value ratio then to buy right now might be a very good idea.

 

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