Are private renters safe in their homes?
At a recent conference held in London in November 2022, the Director of Generation Rent, has argued that a lack of housing options means that private renters are at greater risk of eviction. Baroness Alicia Kennedy described how the increase in competition for rental properties means that landlords may be tempted to evict current tenants to raise prices for new renters, with little protection available for renters should this happen. The Head of Policy for the Advice for Renters organisation also described how this issue has been exacerbated by the cost of living crisis, which has squeezed personal finances further and raised rental rates across the UK.
But what are the advantages and disadvantages of renting privately and is buying a better option than renting?
Advantages of private renting:
1. Shorter term commitment: since rental contracts are usually six or 12 months, you’re not tied into a long mortgage contract. This is a double-edged sword, however, as less commitment also means less security.
2. Less responsibility for maintenance costs: as a renter, you’re not liable for the costs of maintaining the property, however, you will still need to make sure that you have contents insurance. It’s also worth remembering that you will have to rely on your landlord to complete any required maintenance.
3. Flexibility in location: renting privately can be a great way to explore living in different places.
Disadavantages of private renting:
1. Cost: the average cost of renting privately in the UK has risen significantly in recent months. The average cost of renting in Birmingham is £1469, compared to an average monthly mortgage payment of £1285. Of course, mortgage payments will also be contributing to paying off your loan, building equity in your property.
2. Lack of security: as a private renter, your landlord can evict you provided that they give you sufficient notice.
3. Competition in the market: the rental market in the UK is very competitive, particularly in larger cities. This gives renters little option over properties.
Getting on the property ladder as a private renter
If you’re looking to make the move to buying your own home, it may be more affordable than it first appears. According to the BBC, five year mortgage rates are now back below 6%, which can mean that mortgage payments will be lower than monthly rents.
The Help to Buy equity loan scheme offers first-time buyers a loan of up to 20% on a deposit for a newly built property. This can then be repaid interest-free in the first five years. Private renters can also sign up to credit report services to build up a positive credit history, which will help secure a mortgage.
There are also other costs involved in buying a house, such as moving fees and paying for a home buyer’s report, which need to be considered. In big cities, choosing local conveyancing solicitors Birmingham or London or Leeds can be a great way to take advantage of a company’s knowledge of the area. Firms such as Sam Conveyancing can offer a full conveyancing service to make the process as smooth as possible.
Private renting has many advantages and disadvantages, but every individual’s circumstances will determine their housing decisions, so it’s important to consider what’s right for you.