Are You Ready for Home Ownership?
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behindblueeyes My husband and I just moved to the Great Northwest, and we batted around the idea of purchasing our first home. We are both college graduates, have great jobs, and we’re ready to live the American Dream! Not only are we ready to live “The Dreamâ€, but the financial aspects of home ownership are certainly appealing. I mean, who likes throwing their money down the toilet every month in rent checks? I sure don’t! So, why would we choose to rent rather than to purchase a home?
Everyone will tell you that the first step to purchasing a house is to analyze your budget. Can you afford the monthly mortgage payment? What about taxes, insurance, and maintenance? Would you be able to handle a financial emergency, such as your heater dying (and needing to be replaced immediately!) in the dead of winter? Most professionals will tell you that if you answered yes to all of those questions then you’re on your way to becoming a homeowner.
My husband and I answered a resounding “YES!†to all of those questions, but we have decided to rent an apartment rather than to purchase a house. Why? Because we are not ready to be homeowners. Although we want to live the American Dream with a house and white-picket fence, we are not ready for the responsibility of owning a home. Sure, we can afford the mortgage payments, but neither one of us wants to make those payments. We have other financial goals that we want to meet before we take on the burden of a house payment and house maintenance. Additionally, neither one of us likes house or yard work! So, after much deliberation, we decided that we prefer the relatively worry free life-style that renting affords us.
Although homeownership is a hallmark of the American Dream, the first step to purchasing a house should be to ask yourself if you’re ready for the responsibility of that Dream. Are you ready for the financial commitment? Are you ready for the preventive and emergency maintenance? Are you ready for the taxes? If you answered “YES!†then you are able to move to the second step of figuring out if you can afford the Dream.
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If you're not ready for the taxes as a homeowner, you're not ready for the taxes as a renter. In most states, property tax rates are higher on rental property than on owner-occupied homes. Landlords do not act altruistically - their property taxes are factores into the rent they charge.
Good for you for ignoring the pressure to buy your home. Nearly everything you read or hear about owning vs. renting leads you to believe that only losers rent. It's rare to hear about the downside to owning. Maintenance of a home is a tremendous amount of work and if you're not able/willing to do it yourself, it's extremely expensive to hire someone. I've put thousands of dollars into my home for routine upkeep - far more money than I'm gaining from the tax write-offs for owning. Never again!
I was a home owner for 14 years and was continually in debt and stressed out from HOAs breathing down my neck, yardwork I couldn't do or pay someone else to do, furniture I couldn't afford, repairs, taxes, etc. etc. I have rented a cute little apartment now for 2 years and have paid off the $17,500 credit card debt that being a house owner caused me. Problem with bugs, light bulbs, heaters, anything at all...the apartment office complex handles EVERYTHING for free. I mail back those annoying realtor "don't you feel like a loser apartment renter' postcards I get each day in the mail, telling them to leave me alone, that they're wrong, I LOVE renting and wish I'd done it sooner. I am a single mother. Now we can take vacations and buy shoes. In my area the cheapest house would cost me probably $400 more a month alone in the mortgage. I am so happy renting, it's ridiculous.
When I added up all the stuff that my (admittedly excellent) apartment includes in the rent (your list plus: heat, water, sewer, garbage, and basic cable), I came to the conclusion that you could give me a house for free, and I couldn't live in it as cheaply as I live in my apartment.
I still hope to buy a house someday, but I'll know that I'm paying extra for the amenities and the extra control over my space.
Good for you! I've always thought the financial arguments behind a house (throwing away money, tax break) were overstated. My wife and I own our house. While it's the right decision for us, we still fondly remember our apartment days.
I don't know if Condos are a valid option for you in the future, but they seem to be a good compromise between the financial benefits of a house and the low-maintenance of an apartment. Of course you have to deal with the association in that case..
At the end I kept thinking about the elephant in the room you avoided, namely buying a condominium. It would avoid many of the problems you mentioned, and in some parts of the country the mortgage isn't that much more than rent.
And you end up owning something without "throwing it down the toilet".
I bought a townhouse, which is more complex than living in a condo, simply because there's a bit of outdoors to deal with and several levels to live on. Now, I'm happy with the purchase, because my net worth is MUCH higher than it was two years ago, but I have to admit that I am completely overwhelmed by the work that it takes to care for the place. Getting it decorated (nothing fancy), painted, and keeping it clean and functioning has been amazingly difficult.
I recently added several pots of flowers around the house, and while they look amazing, it's just ANOTHER damn thing that I have to take care of every morning. If I had a roommate or a husband it might be one thing, because then I could split some of the responsibility. But it's just me (and sometimes my parents, when they take pity on me and come over to help me for a weekend), and it's EXHAUSTING.
I can only think of two things I like about my house. No noisy neighbours upstairs or downstairs and the freedom of pet ownership.
I am continually amazed by how much money I'm dumping into the house. It's not any single thing either. It's EVERYTHING. Furniture, repairs, upgrades and huge money suckers like the roof. While we haven't had to dip into retirement savings, we haven't added anything to them either since buying the house.
The good news is that housing in our part of the country is among the cheapest around.
But as far as I can see, the house will be our primary obstacle to early retirement.
Here's the contraian point of view
http://tinyurl.com/2v2y4z
Why Rent to Get Richer
plus trent over at the simple dollar asked the same question
http://tinyurl.com/32nzpj
if you want to truly make an investment in your home however your best is to opt for a hire and installation material. if you want purchase a house in a urban areas initially analyze your financial investment. how much money you can spent? you can take advice from consultants, about dimensions of your home,furniture,toilets and each &every thing which is necessary for home.
if you have good knowledge about the taxes and investments then you can invest your money.
Roof Repairs
Home ownership in the America is very expensive.Many people want to purchase their own home but when they the mortgage payment of monthly and know about all taxes then they take decision to take the house on rent.Because all the interior and other parts like roof tiles are more expensive.In above article this is also the main reason.
http://www.newrooflongisland.com
Roof Repairs