Has the dream of owning your own home become an obsession? Are you longing for the day you can say “bye, bye” to your landlord? Do you have visions of a turquoise living room? If you’re nodding your head in agreement right now, stop for a minute and consider. Could apartment living offer more perks than you realize?
Starting out with goals is good strategy. Graduation, developing a career, moving from renter to homeowner is all part of the Great American Dream. But here’s the thing, with the shifting economic landscape across the country, flexibility is a key to success.
Getting caught up in the wonder of home ownership often skews our perceptions – all those potential benefits! And yes, the benefits are very real. You can build equity and develop the property. There isn’t a landlord breathing down your neck when you want to redecorate and no more monthly rental enriching someone else.
But, there are many benefits to apartment living that can get pushed aside when making the decision to buy your own home.
Property maintenance is one consideration. Imagine your hot water heater bursts on a Sunday night; it’s the landlord who has to deal with it. As a homeowner, it’s up to you to fix the problem, either by calling in a repairman or doing it yourself. That’s money that has to be spent on labor and parts, not to mention the sheer hassle involved in finding competent professionals.
Also falling under property maintenance are things like mowing any lawn area, keeping trees and shrubs trimmed and neat and dealing with weeds. These are tasks when you rent that won’t cross your mind; they simply happen.
Monthly rental may be a thing of the past but even when the mortgage is paid off, there are still property taxes, homeowners insurance and association fees. And speaking of insurance, with apartment living, renters insurance is far cheaper than homeowners insurance for even the lowest cost property.
Seeing the hidden costs
These factors all mean additional expenses when you become a homeowner. They often get overlooked in the glow of buying a home. But when you begin to compare a mortgage to renting an apartment you need to be aware of the hidden costs.
As one new homeowner found out, their biggest misconception was that living in a house would be cheaper than apartment living. Still, for most folks it’s the right choice. Just don’t count on it being a choice that will necessarily be saving any money.
If you’re serious about making the switch from renter to homeowner, you’ll need to spend some serious time running the numbers again and again. Be certain that the financial benefits of buying a home will be greater than the financial benefits you’re getting from renting.
Entering your figures into a good “rent vs buy” calculator will help put the switch in to perspective. The results you’ll get will be the cold, hard numbers, devoid of emotion, to help you assess your next move.