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I hope to buy soon, and I am very much looking forward to customizing my abode, keeping the interior and exterior looking good, and getting involved with my neighborhood and town. I just don't do that--and I don't see why anyone who rents would--when you could be tossed out and living in an entirely different area within a month or a year.
The US should encourage home ownership to improve civic involvement of residents.
And there's the rub about renting. A vast number of renters don't feel invested either in the community in which they live or the house or apartment they occupy. As a consequence, overtime, abodes usually get run down and entire neighborhoods go to the dogs. Crime rises and eventually the area becomes nothing more than a slum.
I agree entirely in your last sentence and wish you all possible luck in your quest to ecome a home-owner.
I don't see a home as an "investment" though. Usually a bank has a lien on your home for 15-30 years. A house has so many upkeep expenses which may even be like paying rent on top of your mortgage--or at least half of it.
Personally I think it should be subsidized. If it wasn't I would be paying more out of pocket and wouldn't be able to write off the interest on my 2.75% fixed mortgage which saves me a ton of money that I invest in the stock market. [Does your landlord write off the interest on the property he rents to you and pass the savings on to you the renter?]
Owning a home is better for the environment because renters don't care about the environment.
It's my decision who flexible I want to be. I bought a home in a region with lots of jobs. If I loose mine, it's unlikely I would have to move.
I think it's a gross generalization (and inaccurate) to say that renters don't care about the environment. Rental units tend to use less energy and space than homes, which is why I said renting is better for the environment (though that is not necessarily the case as some renters rent entire houses).
Rent in the D.C. area is outrageous. Renting a 2 bedroom in a moderately decent area can cost nearly as much as a 3 bedroom home in some areas. That's without factoring in equity and tax breaks. I had been renting for years before my wife and I bought a home and there is no comparison as far as I'm concerned. The privacy you get with owning a single family home alone is worth the leap. I never have to worry about my neighbors playing loud music or stomping around back and forth above me while my children try to sleep.
In my opinion, communities would have a difficult time developing without homeownership. I personally don't see how renting is better for society. Generally, most areas with higher percentages of homeownership tend to have closer knit communities. When people invest in an area they are more apt to work together to maintain that area (i.e. neighborhood watches, town hall meetings, community gatherings, etc.). If something happens in a neighborhood that folks don't like, the neighbors can work together to solve the issue. In rental communities with people constantly moving in and out, the prospects of this happening has been low in my experience. So in my opinion, homeownership has great benefits...and not just to the homeowner.
But that are communities with a very large concentration of renters and relatively few home owners (I;m thinking of Ithaca, NY as a good example) where people are very invested in their communities. In Ithaca, there's a lot of community activism and small businesses (as opposed to the corporate chains that dominate most communities).
But there are very nice and low crime cities such as Manhattan and Ithaca where most people rent.
NYC, due to the astronomical cost of buying a home along with rent control laws, has a large population of "Long term renters". Many of those people would buy if they could. But it is not uncommon to find people renting the same apartment for 10 years or more in NYC.
Ithaca has a very large population of students, most of whom make up the renter population. As in any college town, once you remove students from the equation most of the people who actually live there long term own.
Anyway, I agree that renter doesn't automatically equal crime and run down neighborhoods. But I do think it is in the government's interests to support home ownership due to the many benefits it seems to yield for society.
There are lots of nice places where people primarily rent.
And not just in New York, etc.
I do think that home ownership is definitely touted without everyone really being aware of the risks/benefits, facts, etc. Everyone thinks renting is 'throwing money away' and buying is somehow financially savvier or something. If you don't actually do the math, figure out what actual appreciation is expected to be, etc, you can't really say anything with any accuracy.
I own my home. But I have no delusions about it being an 'investment.'
American society has long prized home ownership (ie: the "American Dream") and looked down upon renting. Do you agree with this element of American culture?
Personally, I do not and believe the decision to own or rent is a matter of personal choice. Home ownership should not be subsidized like it currently is by the government (Fannie, Freddie, mortgage interest deduction, bankruptcy protections, etc.,), especially considering that renting is in many ways better for society (better for the environment and allows for more labor market flexibility).
I'd rather see the federal government encourage home-ownership and since somebody has to own it does stabilize and promote civic involvement in communities since people have a financial stake.
Unless of course, the state owns all housing, which would be Communism. Worse would be investors owning all housing!
Renting is not always totally a matter of personal "choice". Try buying in NYC. Although, the "choice" might be to move to Montana and build a cabin.
In some states, renters are allowed to deduct rent, which helps to even out the tax situation.
I think for certain professions buying is a good idea. Teaching as well other government type jobs have a lot of security. I think there is a paradigm shift that makes it unlikely that people will stay in the same job, profession or location for fifteen to thirty years.
There are too many things to consider that makes everyone's situation unique.People who pay high rent live in places where homes are expensive. College towns have dumps that are high rent and buying a house is not economical because the prices are based on every house being income property.
An older retired couple I know have rented a house for over 30 years. They have the kind of jobs that any bank would have lent them any amount of money within reason to own a house. People in their professions usually buy in the upper $100,000's . They have raised their kids and lived in a sturdy brick bungalow which would probably sell for around $50,000.. I think the key is if you are going to rent long term rent a little below you standards.
Another woman who is in her eighties bought a house in the late fifties or sixties for under $20,000. The house is worth maybe $200,000 today. She said she wishes they would have invested all the money they put in that house. Now is a good time to buy a because a lot of people put a lot of money in homes that they do not expect to get back. So you get a head start on your maintenance cost.
Last edited by thriftylefty; 04-07-2013 at 10:49 AM..
American society has long prized home ownership (ie: the "American Dream") and looked down upon renting. Do you agree with this element of American culture?
Personally, I do not and believe the decision to own or rent is a matter of personal choice. Home ownership should not be subsidized like it currently is by the government (Fannie, Freddie, mortgage interest deduction, bankruptcy protections, etc.,), especially considering that renting is in many ways better for society (better for the environment and allows for more labor market flexibility).
This is my first time on this forum but I had to chime in. I think home ownership is glorified. I make a good income but not enough at this point to be able to afford to buy a house (too much other debt). I like the fact that since I am renting I have the ability to look for another job and all it requires is a 30 day notice to the landlord. I don't have to worry about selling or renting a house out to someone.
I'm also amazed at how many coworkers I have that have bought houses on impulse. They seem to think home ownership is a requirement and they rush into buying a house. I have seen several then decide they want to relocate and now they have to deal with a house. I have also seen some that have bought houses and the only way they could afford to keep it was by having a roommate to help pay the mortgage. To me that means you can't afford the house so why not just rent?
Also, as a side note, what do you think of college grads moving home with their parents to save up and buy a house? I don't agree with that at all. Live on your own and stand on your own two feet. I'm sure I've just offended several people on here.
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