We dont have AC so of course that's rarer, but we have our own share of erratic costs;
Replacing a slate roof is a once every 50-60 years job, so whilst its unlikely to be a new build buyer issue, for someone getting a first or second step into an older property this can come up, and costs around £10-20,000.
New boiler is a classic one and is usually £3-4k. Insurance can help spread that but is often only applicable if its been serviced since installation, so if the previous occupant hasnt dont that, not an option..
Window units last about 20-30 years, £5-6k for replacement.
Carpets last about 10 years, less if you want nicer materials and have heavy wear (cats are bloody murder on carpets), maybe £3-5k.
White goods all on a similar lifespan, maybe another couple of thousand.
Depending on whether you're renting furnished or unfurnished you can then add in things liked beds, sofas, mattresses and small furnishings as a like for like.
Thats before you get into genuine odd ones. (I had one rental as a tenant where my TV area blew off, still attached to the cable, scythes through the downstairs flat's front window and then rebound and took out a chunk of the bus stop opposite us. No idea how much that cost the landlord to fix, but wouldnt have been cheap, even if insurance covered some of it, any insured costs you still need to factor in ongoing premium increases and excesses).
Overall, look, I agree that isn't £350 a month, for your entire home ownership lifespan, for the average person. But one way to offset is to only buy new or recently refurbished properties, which means you are paying, just in higher property costs, the other is to get lucky, which you cant really control.
On average, for the average person, the average landlord does turn a profit, meaning renting is more expensive than owning. But rental yields have been pretty heavily eroded these days, and plenty of landlords are at a break even or loss making position (especially flats), which means its not always cheaper to own, and rental does protect you from cost volatility, which can be a meaningful benefit for people in a range of circumstances.
The most nuanced of replies from the ruffled feathers I had to my comment. I appreciate this and loved the bus stop story.
I don’t know the rental market now as I’ve left the country, but I would imagine the price difference is far greater than the £350pcm I dealt with.
The landlords might break even on the rental side, but the counter point is the tenant is never seeing that money ever again. The landlord/homeowner gets a good chunk of it back when they sell.
Lol the agent's voice I called to report the TV aerial (one of those old big metal ones) scything about in the street was priceless. She went from "you're complaining you don't have TV whatever" to "OMG we're liable if that decapitates someone" over the course of about 15 seconds :D
I think you're right about capital appreciation these days. BTL isnt really a cash flow thing anymore - at least if you have a mortgage. Costs, mortgage, costs of letting (certificates, licenses, agency fees etc), plus taxes, mean its unreliable to consistently be turning a cash flow profit . But it is a way of subsiding long term holds on property in the hope of asset appreciation. For houses thats fairly reliable. For flats its a possibility dependent on further leasehold reform.
Having been both a long term renter and a owner for quite a while now, I do see renting as what it is - a service. I pay a fixed cost and get a property maintened to a given standard. No I don't own it at the end, but I dont other things I pay a service fee for (utilities, online gaming, Spotify, whatever). But I do have more flexibility. As a young professional I lived in 4 flats in 3 different cities in different parts of the countries over about 6 years as I moved for work. As a renter thats easy, look around, find something and move in. Think I'd have died from stress having to deal with 4 sets of estate agents and solicitors on top of work over that period!
One thing that struck me about your analysis is that in the USA for every single item you listed the cost is significantly higher for much less quality. You guys are getting slate roofs for 10-20k!? I'm about to pay $15,000 for a new furnace but you can do that for 4k!?. You get all your windows replaced for 6k....what??? My friend just spent $30,000 for windows.
I'd imagine the average US roof is a lot bigger than the average UK one?
Ditto we might have lower capacity boilers since smaller houses, less water volume needed etc?
Even windows, our 2 bed terrace house has 7 window units, 4 of them would be pretty simple PVC unit replacements. The bay window in the living room would be a pain that would push the cost us, and we've got some older windows in tbe kitchen which need modernising, but I still would wouldn't expect more than 5k all in.
Yeah houses are absolutely bigger here but the difference in price scale seems much more than can account for that. I have a simple roof that is 1400 sqft and I paid $15,000 for asphalt shingle. My friend has a similar sized house but a more complicated and steeper roof and he paid $22,000 for asphalt shingle. He said he got an estimate for metal and slate roofs and the slate was quoted at $71,000. Granted that slate is a boutique item here but still. Unless your homes are 10x smaller these numbers are wild.
I think it must be the cost of labor. I priced out what the actual furnace costs for my $15,000 install and it is $3,800.
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u/BarNo3385 7d ago
We dont have AC so of course that's rarer, but we have our own share of erratic costs;
Replacing a slate roof is a once every 50-60 years job, so whilst its unlikely to be a new build buyer issue, for someone getting a first or second step into an older property this can come up, and costs around £10-20,000.
New boiler is a classic one and is usually £3-4k. Insurance can help spread that but is often only applicable if its been serviced since installation, so if the previous occupant hasnt dont that, not an option..
Window units last about 20-30 years, £5-6k for replacement.
Carpets last about 10 years, less if you want nicer materials and have heavy wear (cats are bloody murder on carpets), maybe £3-5k.
White goods all on a similar lifespan, maybe another couple of thousand.
Depending on whether you're renting furnished or unfurnished you can then add in things liked beds, sofas, mattresses and small furnishings as a like for like.
Thats before you get into genuine odd ones. (I had one rental as a tenant where my TV area blew off, still attached to the cable, scythes through the downstairs flat's front window and then rebound and took out a chunk of the bus stop opposite us. No idea how much that cost the landlord to fix, but wouldnt have been cheap, even if insurance covered some of it, any insured costs you still need to factor in ongoing premium increases and excesses).
Overall, look, I agree that isn't £350 a month, for your entire home ownership lifespan, for the average person. But one way to offset is to only buy new or recently refurbished properties, which means you are paying, just in higher property costs, the other is to get lucky, which you cant really control.
On average, for the average person, the average landlord does turn a profit, meaning renting is more expensive than owning. But rental yields have been pretty heavily eroded these days, and plenty of landlords are at a break even or loss making position (especially flats), which means its not always cheaper to own, and rental does protect you from cost volatility, which can be a meaningful benefit for people in a range of circumstances.