As a relatively new homeowner, who thought I'd never be able to buy a home, it was never even a question of whether it was a good idea to buy a home, but rather if I'd be able to. Locally prices are constantly increasing for rental apartments- our first apartment's rent more than doubled in price in the 5 years we were living there, so if you stay in one place you just pay more and more and eventually get priced out and need to pay to move. And landlords are individual people that often do terrible jobs and you suffer because of that. But now I'm a home owner and a landlord and I see that being a home owner does come with extra costs that you don't originally realize. However, I'd still take being a home owner vs renter any day.
Homeownership has long been a pillar of the American Dream. Around the country, millions of individuals, couples, and families strive to buy their first home so they can experience the privacy it offers and put their money toward something that will benefit them in the future.
The decision between buying and renting is not an easy one. Renting is much more flexible because you are likely locked into a lease only for the next year as opposed to a 30-year mortgage. Additionally, you do not have as much of a burden to take care of the property, as repairs and major improvements can be handled by the landlord or property manager.
Buying the home so that you become the owner comes with a much different list of responsibilities. However, many would argue that the benefits outweigh the costs. Let’s talk about those benefits and why they are so convincing for those who want to own a home.
Laying Down Roots
While you can make a community feel like home no matter what your living situation is, there is something about homeownership that takes things to the next level. A home is typically a long-term commitment to living in a certain area, especially when you consider most mortgages last for ten, fifteen, or even thirty years. Plus, a home usually comes with a yard, so you can easily host events like neighborhood barbecues to get to know the people around you. When you lay down roots by purchasing a home, you feel more connected to your town.
Building Equity
The first benefit of owning a home has to do with finances. When you rent a living space, your money goes into the landlord’s pocket simply to buy you the right to occupy the space. You will never reap the benefits of those rental payments again. However, when you buy a home, you can build equity with each mortgage payment. Equity is the difference between your mortgage balance and the real property value of the home. The more you have paid off on your loan, the more equity you have. This home equity can be used to refinance for better loan terms, take out cash to invest in improvements, or receive greater profits when the home is sold. In general, the longer you live in your house, the greater the return on investment will be if you make any of these decisions.
Privacy
Another primary benefit of homeownership is privacy. Now, this is not true across the board, as it is entirely possible that you experience less privacy in your home if you are extremely close to neighboring houses. However, a single-family home is not attached to any building where other people are living. That means you are no longer sharing any walls, floors, ceilings, or yards with another renter. The lawn outside is yours to enjoy. No one is going to be entering the building to head to their own living space. This privacy can make you far more comfortable, especially if you have a family and don’t want to worry about disturbing the upstairs neighbors with noise.
Freedom to Upgrade
It is a homeowner’s privilege to be able to customize their property however they see fit. As a renter, you would need permission from the landlord, and even then, they would likely be in control of any upgrade projects. As the owner of the home, you can make whatever changes you desire as long as you adhere to building codes and potential homeowner’s association restrictions. Home renovations boost property value as well, so making changes can benefit you financially in the long run while improving the functionality of the home today. After buying a house, you can furnish, decorate, remove, replace, and renovate however you want to create the perfect home for your family.
Applying Practical Skills
A home is a complex structure made up of many materials, systems, machines, and possessions. Taking care of all these elements requires ongoing maintenance. When you become a homeowner, you are almost forced to learn practical skills so that you can avoid paying contractors to do every little job needed in the house. For example, you will start to understand the electrical system in your home and how it works, allowing you to make minor repairs if something goes wrong. Eventually, these practical skills could evolve into something that can have financial implications.
However, different states require different licenses if you go down the route of becoming a contractor. Consequently, if you love working with your hands in your home and you’re based in the Grand Canyon State, perhaps you can search online for an Arizona contractor license and exam preparation course to prepare for the licensing process. Then, you could get paid to use the skills you have learned as a homeowner for other clients with that license.
Status
Although status should be an insignificant part of the equation, it is hard to deny that owning a home can make you feel more confident about your life situation. In some cases, owning a home can even grant you certain social advantages. It demonstrates that you have a level of fiscal responsibility, which other lenders and even employers would be grateful to see. As a member of the community, people may take you more seriously knowing that you have a permanent residence in town as opposed to a short-term living situation that could change from year to year. Though this benefit is minor and unimportant to many, it is still a factor to consider.
Weigh These Benefits With the Costs and Extra Responsibility of Homeownership
Buying a home requires a give and take. You are giving up certain privileges, such as short-term leases and not having to handle all repairs, but you will be taking on benefits like building equity and greater privacy. Owning a home is a great privilege if it suits the lifestyle you want, and the ability to invest in upgrades and practice your construction skills only sweetens the deal further. Consider the costs and risks associated with homeownership to determine if they are outweighed by the benefits listed above.
