My whole life I've been taught that being successful as a person was having your own home. That proverbial white picket fence that everybody wants. As I'm experiencing life more I've owned two homes. I've had the fence. And you know what I don't want it anymore!
It's funny because I hear reports lately where it is reported that having home is not a sound investment anymore. It's not what our parents told us that a home always lasts and always keeps it value. Homes are liabilities now. It's a liability I don't think I want anymore.
Yeah renting for the past 3 1/2 years is really open my mind to the difference between renting and owning a home. Again, owning a home is something that I always wanted because it was something I was always was supposed to want. I realize now, it's something I may not ever want again. Partially because it's too much responsibility and really, no security.
Here's a list of things that I realized why renting is better than owning:
1. You can move anytime you want without having to sell a house.
2. You can change locations in your city, every year if you choose, if you get tired of where you're living.
3. If something breaks you don't have to pay to fix it!
4. No property taxes! Sometimes those can really get up there in price depending on where you live in the value of where you're at.
5. More expendable income. You have more income because you don't have to sit and keep fixing things up on your own house. If your apartment or condo gets run down too much, you either move or you ask them to fix it for you.
6. Want to pool? Then rent a place that has a pool!
Here are the things I realize why owning is sometimes better than renting:
1. You can decorate and do anything you want with your home. You can tear out the kitchen if you don't like it and replace it. You can change the flooring. You can paint the walls any color you want and not care to have to paint them back when you move.
2. If you plan to stay in one place for very long time, then you might make some money on your house when you decide to move.
3. Your rent can go up. Your mortgage, when you refinance, can go down.
4. The tax write off!
When I mentioned to my mom that I didn't think I ever wanted to buy a living space again she didn't really accept the thought. She pretty much said that it was the stupidest idea. I can understand where she's coming from since in her generation that was the American dream. What she doesn't understand is I look at all the money that she and my dad put into our homes growing up and all that money that could have been put into stocks, bonds, 401(k)s, money market accounts, that they would probably be retiring a lot better off than what they are now. Not that they are lacking in their retirement. My dad had the city job with a good pension. But all the extra expendable income that they used to replace floors, air conditioners, services on the house, etc., doesn't seem like a good enough payoff. I know in our first home, we made a lot of money because we bought in a market that was rising so quickly. But in our second house, the market declined and we lost more than what we gained from the first. It's kind of like a game; Sometimes you win. Sometimes you lose. In the end we lost.
Currently we pay about $1200 a month for rent. In a home that we could afford to buy, here in Austin, TX, (say a $140,000 home) our mortgage would only be around $950 a month. Sounds like renting is stupid now. We could be in more space and own something for less. But wait, I forgot to add that property taxes would be about $350 a month, HOA fees would be an additional $150 a month on top of a larger heating/cooling bill, sanitation, yard maintenance, home owners insurance, and trying to keep something left over in the bank just incase something breaks down (like the A/C). So my rent is looking pretty awesome. Let me now mention that the place I could buy, if translated into an apartment would actually make my rent (like for like) around $800 a month since what I could afford to buy would be in a lower grade neighborhood, not as close to work or social life, and not as nice since it would be older and probably need renovations. So really, I can live in a better place renting, than I can buy for less.
While this is only my perception, I think it works for me and I don't think I ever want to own a home again. That may change. Maybe one day I'll make a lot more money where extra expenses don't matter to me and I really need that tax write off. Maybe one day I will want to be settled down a little more in one place. But for me right now, I'm not that settled down, and I don't make enough to really need the tax write off. I think I'll stay renting for a while and keep that freedom in my life and money in my pocket!
*Disclaimer - I am fully aware that in many places in the United States that house costs and property taxes are not as high to where buying is much more economical, unfortunately, I don't want to live in any of those places.
No comments:
Post a Comment