When renting beats buying

Do you need to own your own car, house or even wedding dress? Here’s how a true penny pincher gets more for their money – and space in their house.

Would you consider renting a big-ticket item instead of buying it outright? There’s a growing culture of renting in the UK; as budgets are pinched, fewer people can afford big upfront costs.

But that’s not necessarily a bad thing. Here are some occasions where renting can be a better choice than buying.

Your car

For many people, leasing a brand new car could turn out to be a cheaper option than buying one. Admittedly, you don’t own it at the end of the contract, but you also don’t have to take the loss caused by depreciation.

That means that it can actually work out cheaper to lease it instead of purchasing it. But this does depend on what car you want to buy.

Depreciation aside, product review specialist Which? worked out that it costs £13,000 more to lease a Jaguar XF over three years than to buy one using a finance deal.

Whereas over three years, a Ford Mondeo is cheaper to lease than buy using a finance deal. However, if you plan on paying cash then it’s still cheaper to buy it outright.

Make sure you do your sums for the specific car you’re interested in. As a general rule, if it the model tends to have a high resale value then it’s probably best to buy it and recoup some of the list price when you come to sell. But if that kind of vehicle tends to devalue then leasing it could cost much less in the long run.

If you don’t need a car all the time then you might want to consider a care share or car rental scheme. CityCarClub, WhipCar, Hour Car – there are many organisations where drivers share communal vehicles for a small hourly hire charge and an annual fee.

Your tools

Everyone needs a basic tool kit in their home, but what about those power tools that you rarely use? They can cost a small fortune to buy but if you only need them once a year or less then there’s very little point in purchasing them.

Instead, why not rent them when you do need them? Companies like HSS and Hire Station have branches across the UK and rental prices are lower than you might expect. For example, you can hire a power planer for under £24, or a worktop jig for just over £20.

A spray extraction carpet cleaner can cost over £300 new, but you can rent one for just over £35 a day. Unless you’re planning to use it very regularly, it makes real sense to rent it instead.

Your wedding dress

Okay, hands up – I didn’t do this. But now I have a dress that I can’t sell that fills most of one wardrobe. Looking back, if I had rented then I could have had a more glamorous gown without spending half as much.

For example, the average wedding dress costs £977, according to specialist magazine You and Your Wedding. But you can rent a brand new gown for around £300 or a previously worn gown for less than £200.

Your special occasion dress, dinner jacket and diamonds

You could also consider hiring your dress or suit if you’re a wedding guest, instead of buying a new outfit every time a friend gets hitched. There are plenty of specialist shops and websites that cater for this, both online and on the high street.

It’s probably more common among men, after all, not that many people need to own their own morning suit after a wedding. But whether it’s a ball, a cocktail party or a day at the races, renting instead of buying will help you keep the cost under control.

And if you want to add some sparkle to a special outfit, you can even rent high-end jewellery. This isn’t cheap (for example, one website has a white gold pendant for £265 a week), but it is cheaper than buying it outright.

Your home

Admittedly, a recent Halifax survey found that buying your own home is 16% cheaper than renting- but bear with me. House prices fell by 0.2% in January, according to Nationwide and the Land Registry says prices in England and Wales fell by 1.3% in 2011.

If you think there’s a chance that property prices will continue to creep downwards, then you might decide it’s worth renting for the time being.

But it also makes sense to rent a little longer so that you can save up a bigger deposit. The higher the loan-to-value, the higher the interest you’ll be charged. It could well be worth sitting tight, renting a little bit longer and building a bigger deposit so that you can qualify for a more competitive mortgage.

Your handbag

The amount it’s possible to spend on handbags is terrifying, especially if you want to carry something by Louis Vuitton or Vivienne Westwood. And not every handbag suits every occasion, so if you’re a real handbag fanatic, you could end up spending a monumental amount of money.

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But what about renting your designer bag instead? A number of businesses exist that promise to save their customers hundreds of pounds by hiring designer handbags instead.

Most of these sites require a monthly membership fee, so this isn’t exactly a penny pinching strategy. But if your handbag habit is out of control then this could save you money and give you much greater flexibility.

Your shoes

Sometimes, the most expensive part of a woman’s outfit are the shoes she’s found to match it.

Jimmy Choos, Dior, Alexander McQueen – you may be desperate to match your special occasion outfit with a pair of designer shoes, but these can easily cost upwards of £300.

So think about renting them instead. Again, there are a number of companies that hire out shoes for special occasions, letting you look glam without spending a fortune. Again, there’s often a monthly fee for membership.