I have this impression that it’s seen as a riskier decision to buy a home, knowing you won’t live in it long enough to pay off the mortgage and then sell it when you’re ready to move away, when compared to renting a home. Am I off base on that, and if so, why is this the case?
In: Economics
As well as cost of the house, there are fees as well. You will be charged:
* Solicitor fees
* Mortgage fees (you get a better deal if you pay a £1k upfront cost)
* Mortgage arrangement fees
* Stamp duty (for houses over £250,000)
* Valuation fees
* Building surveyor fees
* Estate agent fees
* Electronic Funds Transfer fees
* Homebuyer’s insurance fees
* Insurance fees
* Council tax (you, rather than the landlord now needs to pay)
In short, there are LOT of expenses you have to suck up when buying a house. If you were buying a house worth £300,000 and it was going to be your only house, you’d have to pay an additional £2,500 in stamp duty to the government. If you move house a few times in your lifetime, you just have to suck up those costs, if you do it regularly, then you need to move into a wreck of a house, do it up and sell it for more than it’s worth for those costs to be worth it.
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