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SICK OF RENTING?

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Written by Melanie Toye, December 1, 2013

I do not need to list the hundred reasons why you may be sick of renting. Though inspections, being pushed around by agents and the aspect of dead money may be enough for you to consider other options, besides renting. 

Can I afford a mortgage? 

If the idea of renting no longer is pleasing to you, then maybe it is time you looked into getting a mortgage. It may even be more affordable than you think. Especially with Australia's lowest interest rates ever, you can expect to start your mortgage with a good head start. 

It is important to note, when looking at the affordability of repayments, to calculate the interest rate at 7.5%. This will give you an idea if you can continue the repayments at a higher interest rate (as they do move often). And after a three year fixed mortgage at 2.5% interest rate, the interest rates may be bumped up to 4%. You need to know you can afford the extra repayments (if or when that time may come). 

When you first get a mortgage, especially at low interest rates, it is in your best interest to put extra money into your mortgage. This could scrap years off from your total mortgage repayments. Just be sure when applying for a mortgage, that you will not be charged for adding extra money into your mortgage, whether by lump sum or regular additional repayments. 

Why is rent deemed dead money?

Example- you go shopping and spend $200 on a new outfit. The new outfit will not make you money and will depreciate in value over time (if you go to sell it later on). the $200 you spent, is dead money. There was no fiancial gain for your pocket. 

Now take rent, rent is paying someone else's mortgage off. When the owner of that property goes to sell. Their aim is to make a gain from the property. With the rental property, they had someone else paying for their investment, then profited from the investment once it sold. Thanks to you.

You could spend thirty years paying rent and have no asset in your name. Or you could have a mortgage for thirty years (similar to paying rent) and then have an asset at the end of the term. 

If you are sick of being pushed around by agents, or agreeing to new leases, or being forced to pay an increase in rent, perhaps it might be time for you to step outside of renting and look into buying your own property.

Contact our AMM mortgage professionals who will give you clear advice for your situation. Call today on 1300 799 266 or email: This email address is being protected from spambots. You need JavaScript enabled to view it. .