Owning a real estate used to be a part of achieving the “American Dream”, but around 60% of people today believe that you could still live that dream without needing to buy a house. Buying a roof to live under is the much less preferred option these days and we can all blame it on the rising expenses, the never-ending student loans and the uncertainty in the economic market. Instead of taking on the burden of home ownership, Millennials today prefer spending money on food and traveling. Why invest all of your blood, sweat, and tears on a property, which may increase or decrease in value over the passage of time. While considering investing your hard-earned income, you must look into your financial, professional and social life before making the huge decision of being a homeowner.
How much do you want it?
Living on rent has benefits throughout. A lot of people today claim that with renting, you don’t see any return on your investment, like you do when you buy a house and that’s just plain wrong. Again, how much of your time, income and energy are you willing to sacrifice into the gaping mouth of mortgage payments, down payments, property taxes, maintenance expenses, living costs, utilities, renovations, and the list is never-ending. People living on rent don’t have to stress over all these payments and costs. With renting, at the end of a lease, if you feel like you’re unable to cope up with the rent of the place you’re staying in, you could simply downsize into something that’s more pocket-friendly for you. Or if you simply want a change of scenes, you could follow wherever your heart leads you to.
Now, let’s talk about this baby. When it comes to renting, you could simply choose whatever house, apartment or studio you’d prefer to live in and pay a one month’s rent deposit up front and then regularly pay your rent every month. But with buying a house, you need to pay at least around 15-20% down payment up front, that also, after you’ve been qualified for the loan. And let’s not forget the buying and selling taxes and the monthly mortgage payments. The cost of homeownership exceeds the cost of simply renting. Renters don’t have to worry about repairs, taxes or mortgages, they could simply invest their hard-earned money elsewhere like say, Bitcoin or a business that shows some promise in the future.
Necessary Degree of Self-Confidence
Owning a house is not all glitter farting unicorns and rainbows. Taking a step towards home ownership is putting your self-esteem, and your peace of mind on the line. It is sleepless nights, skipping meals, less time with friends and family and just plain ole stress. There are many studies conducted that show that one’s self-confidence and sense of control is inversely proportional to owning a house, A.K.A. homeowners are losing their confidence. Many have to think and rethink before making any sort of major or minor decision when it comes to their house because, at the end of the day, the decision they make will have a direct effect on their house’s value and their pockets. Americans today, invest everything they have into their houses and at the end of the day when they have to sell, and the value of their house depreciates or simply remains stagnant, not only their wallets, but their self-esteem and decision-making skills take a direct hit. So, while you as a homeowner might be stressing over whether there’s a need to renovate your outdated kitchen, there’s a renter somewhere sitting in front of the couch in pajamas, watching Netflix, with a glass of Pinot Noir.
Homeowner Association (HOA) have two accounts that are, the reserve fund and the operating fund. The Reserve fund is to meet any future costs or financial obligation, more like a saving account and as the name indicates, the operating fund is for the daily expenses when it comes to repairs and maintenance of the association’s assets. The Reserve fund is set aside for scheduled or unscheduled expenses. And unfortunately, HOAs today have underfunded reserves. So HOAs are usually unequipped to deal with any sort of major maintenance or unpredictable emergencies. Another stress for homeowners, in the cases of heavy rains or when they need to repair their plumbing or replace their roofs, there are little to no finances to get the work done. Find more great articles here on Article Glow.
Again, renters don’t have to deal with the whole stress of maintenance, renovations or repairs. If they feel like the place their living in needs improvement, they could just move out at the end of their lease and find a place that is best suitable for them. At the end of the day, before investing all of your hard-earned income, time, energy, and your peace of mind look into every aspect of your life and then decide if buying a house is the best for you. Because remember, it’s not only about achieving the American Dream, a house is a financial as well as an emotional investment.