Is a Borrowing Money to buy a House Better than Renting?

It can be a big decision to decide to buy a home. Many people will rent all of their lives and be happy doing so, but there are others that have a big desire to own their home and will do everything they can to do so. However, for most people, buying their home will mean that they will have to get a mortgage and this is a big commitment. So, is it worth borrowing all of this money?

Advantages of buying a home

Owning your own home gives you a sense of freedom. You will have a property that you will be able to do more or less what you want with. There may be constraints if the building is listed and you will need planning permission for certain changes as well as your lender and insurers permission, but you will have a lot more freedom to d renovations, decoration and things like this as a home owner compared to a tenant.

The money that you pay into your home will tend to still be there when the house is sold and it may even increase in value so much that your money is worth a lot more than it would have been should you have invested. This means that some people consider their home to be an investment. It is better to see it as an investment for your children as you will always need a home to live in but once they inherit they will gain the money that you put into it. If you are renting you will have nothing to pass on to them.

Once you have paid the mortgage, you will not need to pay an equivalent of rent any more. This means that you can potentially go into retirement or later life without worrying about whether you will be able to pay your rent. You will be able to live rent free.

If you need money for care when you get older or need help with cleaning or personal care then you could use some of the money tied up in the house to pay for it. You could use equity release and remain in the home or sell the house and downsize to get out some of the money. Although there may be some government help for some of these things, if you pay for it, you will be able to choose who cares for you or which care home you move to rather than only being able to pick between limited government options.

Disadvantages of buying a home

When you own your own home, you have to pay for any repairs that are needed on it. This means that if it gets damage or just needs modernisation, you will have to pay out for this. This can sometimes cost a significant amount of money. You will also need to pay to insure it and if you have a mortgage you will need life insurance until the house is paid off.

If you want to move it can be much harder when you own a house. You will need to find a buyer for the home before you can move elsewhere or alternatively find someone to rent your home. This last option is quite tricky at times, especially if you have a mortgage as you will need to swap to a buy-to-let mortgage which has a higher interest rate and your insurance may go up too. You will also need safety checks and may need to pay a letting agent to look after the property for you as well.

There is a risk that the value of your home may go down. If you live in an area which becomes unpopular, floods, has contaminated soil or something like this, it could mean that the house value falls. Although this is rare, it is still a risk and you need to consider whether you are willing to take this risk when you decide whether to buy a house.

The biggest risk is making sure you can pay the mortgage. Those mortgage repayments are a huge commitment. Often, they will be the biggest outgoing that you have each month and if the interest rates go up then they could go up even higher if you have a variable mortgage.


It can be a really tricky decision to make as you will need to think about whether you are willing to take the risks of the mortgage over the advantages. The main part of the decision will probably be whether you can afford the repayments. It is worth finding out how much these will be and comparing them to how much you are paying in rent. Rents can be expensive and so you may find that you will be able to afford a mortgage on a similar sized property to the one you are currently renting. If you are moving out form parents then it could be a different matter though as well as if you are moving to a bigger home. So, make sure you work it out carefully.