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Young couple looking for a home

Renter generation – is deposit size stopping you?

Are you giving up on the idea of buying a home in favour of renting? If so you’re not alone.

The number of young people who think they will own their own home in the future is shrinking, according to the Halifax’s Generation Rent survey.

In fact 21% of people aged 20-45 believe it is virtually impossible for first-time buyers to obtain a mortgage.

The most significant barrier to homeownership was the size of the deposit required. High property prices and low income were also seen as problems.

If you’re thinking about renting instead, here are some tips that could help you.

The three tips of renting

1. Consider what you can afford

Bear in mind that renting a property isn’t just about paying your rent. You should think about costs such as council tax, gas and electricity and water bills. Also consider drawing up a budget of your other monthly costs as well – your life isn’t just about paying bills! Thinking about purchases like travel; groceries; and mobile phone bills will help make you better prepared to find a home that works for your budget.  

2. Take the time to read your tenancy agreement

Before you sign a tenancy agreement, be sure to read it in full, including all the small print. It will list your obligations as a tenant. You may be obliged to do a professional clean before you move out, for example, or take out contents insurance. It is important you understand what you are signing up to.  Keep in mind that you’ll need your deposit back at the end of your tenancy to pay the deposit on your next rental property – don’t do anything to jeopardise getting it back!

3. Make sure you check the property first

To avoid costs in the future that may not be your fault, make sure you know what the property is like before you move in. Make a written or photographic record of any damage already in the property when you move in and have the landlord or agent acknowledge this. Also, if the property is furnished, check the inventory against what is included in the flat so that you aren’t later held responsible for any missing items that weren’t there to start with.

 

But what if you want to buy a home and need some help?

There are a number of government-backed schemes aimed at giving home buyers – and movers too – a helping hand onto the property ladder, such as the Help to Buy scheme. The report highlighted 39% of 20-45 year olds either don’t know or are undecided about the impact of Help to Buy. Knowing about the potential schemes out there could help you get a foothold.

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