Rent or Buy? Young couple

Bethy2601

Hi guys

Looking for advice on the best option for the coming year...
Background: I'm going into my 3rd of university where I will qualify and hopefully am guaranteed a job from my placement of 27k-30k per year. I currently have 2 zero hour contract jobs on top of my SF My partner of 5 years is an assistant manager who earns 18k a year which will hopefully rise. I am 23 he is 26. We have been living together at my parents for 3 years😣 and its gets really hard. Our outgoings are currently phone contracts each of around £40 and car finance of £200.

We have opened a LISA the start of this year, which we are hoping to save fully in by April next year (4000+25%) plus some on top of that. We are hoping to save around £10 000 by next June. However, if we decided to rent before then this would be a lot less.

We do not know whether it would be better to carry on saving heavily till June next year and look at buying once I have secured graduated employment or to start renting after Christmas. The reason we would rent is mostly to get out on our own as life is becoming a struggle at my parents and this would also help us get used to budgeting with more flexibility. Especially as I have no secure graduated employment albeit looking hopeful.

Rent is almost more expensive than monthly mortgage repayments in my area also and I would need to find a let that would allow my pup.

Thanks everyone
Beth x

scholesfan88

So many people get stuck in the rental market and find it hard to escape.

If your able to save the deposit and are eligible for a mortgage, then go for it.

You can either pay someone elses mortgage or pay your own and have something to show for it in the end.

ska_lover

Financially speaking, it would be better to stay at your parents and save - but you know this OP

You do say it is becoming a struggle at your parents though

It all depends what is important to you both, as a couple - if you are dead set on ownership or you just desperately want a place of your own

warby68

I'd go for saving hard while you can. Why haven't you been saving much already? With your only commitments £280 and 3 jobs between you the potential seems to be there to save a lot more than £10k over a reasonable period. Unless you have more living expenses not mentioned. You've also lived with parents a long time already but don't have much behind you yet it seems. Not meaning to be critical, but it may impact what's best to do.

Only you knows how urgently you need to move out but you seem to have great potential to save and buy in a reeasonable timeframe which you might not get again.

Yalpsmol

OP is on a zero houre contract with student finance and a partner earning 18k. Unless you're paying market rates to your parents I cant understand why your partner hasnt saved more. But student finance plus some hours here ans there dont leave much for saving

I would stay home and save. Bear in mind once you hit your saving goal you will also have a few months to wait (probably) for the actual buying process. But it will be worth putting up with your parents (probably- I dont know them or how bad the situation is).
Get your partner to start saving hard NOW though because you are going to be able to save a lot more between finishing uni (pretty imminently?) And June if you're on 10k more than him.

Ashbash1991

We used to rent but to get our saving power up we moved back in with my parents......the amount you can put away when your not paying rent is staggering! its not just rent remember its gas,electric,internet,water etc etc.

So id say stay at home if you can manage it....a bit of crap now will pay off loads when you have a house.

lookstraightahead

I know this is a money saving forum so you're likely to get responses with that in mind.

Personally I would rent for now. This gives you flexibility to move (and in the short term buying and then selling with all the costs involved would actually cost you more than renting). Flexibility at your age is very important.

Also living with your parents doesn't make for healthy relationships with you two, or for your parents, or for the relationship between you all. I think you're getting too old to live at home, despite saving money. You risk all falling out.

It's not all about money either. Save as much as possible but live your own lives as well. And also think about your parents' sanity

Bossypants

It might be worth staying with your parents until you can get a FT job, but I would definitely rent for a little while before buying. It will help you work out what's really important to you in a home vs what's nice to have but not essential. Finding that out prior to committing to buying a property can help you avoid costly mistakes down the road

grumiofoundation

Agree with the poster above, that renting gives you flexibility. Staying with your parents may be the “best” financial decision but you shouldn't continue just because of money, you have to make the best decision for all of you. You may not be able to save as much as living at home but with combined salary of nearly 50k you should still be able to save while renting (ditch the phone contracts as soon as you can and switch to £5/10 per month sim only, that’s £720 per year )

Before buying you should sit down and work out the cost/saving of buying vs renting. People generally say buying is always the best option but this isn’t always the case, can depend on a number of factors.
Are you certain you want to stay in the area you currently live, what if you get a chance for a “dream” job elsewhere?
Even if you are sure you will stay in the area how long will it be until you want to move again to a larger property? As a first time buyer there are perks (LISA which you have, stamp duty relief) that you sacrifice by buying. It is eminently possible that if you end up selling within 2/3 years you could end up losing money versus renting when you factor in 1st time buyer relief and the costs of buying/selling. This obviously depends on house prices in your area.

warby68

Even if they do rent for their first home for job or other reasons, I'd still have a go at some serious saving before moving out of the current situation with hardly any bills. Then they have a nest egg ready for when they do buy (or other things of course).

Bethy2601

First year to year and a half my partner moved into my parents he had a large debt to pay off, with little income. (He was recently promoted) I helped him pay the debt off. So we paid the debt off to help with his credit score.

We then decided to go to Mexico, before we move out of my parents so we had a holiday of a lifetime before we have more bills to pay so we had that to pay off.

Additionally in my first year of university whilst we were paying his debt I was on the lowest student finance entitlement of 3000 a year and only had 1 job working 2 shifts a month. He earnt around £700 a month. Additionally invetween that and our holiday this year, we had large family commitments he had to move home (200 miles away) for 6 months where he was income less.

2018-19 and 2020 my student finance is much more and I have my 2 jobs to back me up and he got promoted a month ago to his new salary. So this may explain why we haven't saved large amounts. (We have saved 3000 aside from the holiday we paid off). Life happens :j but we are dedicated to saving all our money 19/20