Wednesday, October 6, 2010

Homeownership Vs. Renting


Everyone wants to live the “American Dream”.
What is the “American Dream”, exactly?.. I have no idea what all it
encompasses. I guess it changes according to each individual. But I do know
that owning a home is definitely in that mix for EVERYONE! Ask anyone
what’s the “American Dream”. Homeownership will undoubtedly
come out their mouth(s). It may not be listed first, but it will be listed.
Many look at obtaining this goal as a sign of sort of “making it”
in the world. This can indicate that for most, but is it the wisest of choices
given today’s economy?

Recently I decided that I am plain SICK of paying rent every
month. Instead of paying my landlord every month, I wanted to start paying the
bank and working towards owning a home. I thought of it as I do my car. I pay a
car note every month. How silly would it be for me to pay these folks every
month and once the 48 months are up I still do not own this vehicle? That was
the way I looked at it. Arguably, a 4 year car loan is NOTHING compared to a 30
year mortgage. I know this, but when I thought of all the money I paid for over
4 years in rent, I could have paid a nice chunk of cash towards actually being
the owner of my place of residence.  Renting vs. Homeownership. IS IT WORTH
IT??

Well, once this epiphany struck me I started research into
how I can obtain a home. I began with my local Housing Authority. I was signed
up to take a Saturday class for homeownership. This class was on the ONE! This
is where reality settled in for me and really had me thinking that possibly
purchasing a home is not the wisest decision for me at this time in my life..

Things that deterred me:

1. Costs of repairs: Currently when something goes wrong, I
call the manager of my apartment building. He may not fix things as fast as
I’d like, but still, he gets the items corrected and I pay nothing more
out of pocket than what I pay every month for rent.

2. Cost of utilities: Right now in my lil apartment I pay
for one (major) utility: Electricity. Gas, Hot Water, Trash Pickup, etc are all
included in my rent. If I were to get a home of my own, I would pay all of
these expenses out of pocket.

3. Job Stability: I feel comfortable with my position within
the company that I work for, but life is all unforeseen. What if my company
experiences some financial hardships and I get the axe?? Currently renting, the
worst that could happen is that I’d owe this apartment a few thousand.
I’d rather take door #1 than what’s behind Door #2 with a mortgage:
Owing hundreds of thousands of dollars

Basically, for me it all comes down to finances. My
household is that of one income. If I had two incomes, I’d possibly jump
out there and try to achieve a piece of the “American Dream”.
Possibly. Who knows.. Maybe renting works better for others. Kind of like those
that go through their lives leasing cars… More flexibility, lesser
costs… It has its appeal.

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