Is Home Ownership for You?
It's often called The American Dream. And for most people, a house is
literally the purchase of a lifetime, often costing hundreds of thousands
of dollars along with decades of mortgage payments, insurance
premiums and maintenance expenses. And as any homeowner will tell
you, you must expect the unexpected. Roofs leak, pipes burst and hot
water heaters predictably die on frigid Sunday mornings or holidays.
But along with its inherent responsibilities and frustrations, home
ownership is very much an investment that can reap big rewards.
Buying a Home is an Investment
When you think about it, buying a house means both a financial and an
emotional investment. Not only do you put a large portion of your
paycheck into a house each month, but you also put out roots into your
neighborhood. Since you now live there and work to keep your house
and yard looking good, you’ll also want your neighbors’ houses and
property to look even better. As a homeowner, you have a stake in your
community and its success.
Risks and Rewards
According to recent U.S. Department of Commerce Census Bureau
statistics, nearly 70 percent of Americans are homeowners. And
perhaps surprisingly, more than 50 percent of households with family
income below the United States median level are homeowners. They
all share in the substantial risks and rewards that come with home
ownership. Most of the risks are financial. Keeping up with monthly
mortgage payments takes discipline, and often sacrifice. But owning a
home also has many rewards. When you’re the owner, you’re also the
landlord. You can decorate your home any way you like and help
increase its value through renovations, such as to the kitchen or
bathroom. Many homeowners also enjoy planting their own gardens...
and even cutting the grass. A home is in many ways a living investment
that can grow along with you and your family.
Buy or Rent?
Although millions of Americans are homeowners, it’s not for everyone.
For instance, if your income tends to fluctuate or you might move within
the next three or four years, renting a house or apartment might make
more sense.
The Government National Mortgage Association ("Ginnie Mae") has a
helpful website featuring a calculator that can help you decide if buying
a home is right for you. CLICK HERE for their Buy vs. Rent Calculator.
Other Expenses to Consider
Yes, buying a home often means 30 years of continuous mortgage
payments. But as Ginnie Mae reminds us, there are several other
housing-related expenses that can determine your ability to afford a
home:
- Property taxes
- Maintenance costs
- Utility costs
- Mortgage insurance (if applicable)
And depending where you live and what type of home you purchase,
you may also need to pay for homeowner association fees, flood
insurance and other fees. It can add up quickly.
CLICK HERE for Ginnie Mae’s helpful information about Your Path to
Homeownership.
Other Helpful Resources
After bankruptcy, will you be ready for home ownership? There are
many resources and websites available to help you consider your
options toward achieving the American Dream:
City of Richmond Office of Real Estate Services
Virginia Housing Development Authority (VHDA)
Housing Opportunities Made Equal, Inc. (HOME)
Housing Virginia
US Department of Housing and Urban Development (HUD)
Government National Mortgage Association (Ginnie Mae)
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Home Ownership
| “Ask about the neighbors, then buy the house.” — Jewish Proverb |
| Your Steps Toward Home Ownership The U.S. Department of Housing and Urban Development's (HUD) website lists the following nine key steps toward home ownership: Figure out how much you can afford Know your rights Shop for a loan Learn about home buying programs Shop for a home Make an offer Get a home inspection Shop for homeowners insurance Sign the papers |
