May 27, 2012

I was amazed to see the headlines in paper this morning about the shift to home-owning.  Although the argument made has good validity in terms of low interest rates creating a “window of financial opportunity” at the current time, it seems it would be in the public interest to include a few more points of comparison that would help them make a decision. 

The article mentioned, but did not factor in, costs of heating and air conditioning….which are included in rent; did not factor in association fees…which are included in most townhome and condominium developments and often vary from year to year; did not include “Special Assessments”  or updates needed to a standard home; did not include lawn and garden costs and maintenance; and did not include winter snow removal. 

It missed the fact that right now with significant discussion about the state of our education system….if you buy a home near what is today considered an excellent school system based on 20th century guidelines, will it still be an excellent system when your kids are in school?  Hopefully, by then, schools will have started educating for life in the 21st century, but what if your school has not?

And what about buying in vicinity of your place of work?   Yes the article mentioned mobility, but I expect most read that in terms of where you work and will you be transferred out-state-the definition of mobility issues in terms of home-buying opportunities for the last 50 years.  It missed  the fact that the trend is NOT to stay with an organization for your career lifetime; it missed  the fact that for two-income families, that normally does not mean proximity for both working adults.  So with the existing infrastructure crumbling around us, the hesitancy to invest dollars in repairs, or in mass transit, should you add transportation issues to the decision equation?  Not to mention, of course that mobility needs are emerging with a very different definition as we enter the changing world ahead of us.   Close to work; close to airports; close to schools, availability of sidewalks and neighborhood stores and centers to create a sense of place and connect you to your community, and the impossible (negative impact on community as well as prohibitive costs)  task of creating new freeways to provide quick access to wherever one wants to go.

Equally significant is the shrinking availability of time to maintain a home…which only continues to increase cost or limit one to becoming a two-dimensional person:  worker and home-owner.

And as important, it did not include the fact that rents are rising according to “what the market will bear” right now because minimal new apartment building has been done for years and years…so apartments are SCARCE…and can support rising rates.

 In other words, it painted a bright picture without all the facts.  It reminded me of the beginning days of the housing boom and the financial institution’s role in the bust that came just four short years ago. 

Again, I am not against home-ownership.  I owned a home for twelve years and during that time, as I continued to develop as a person and my interests expanded, it became an option that was limiting to me.  I chose to sell that home 16 years ago, and only THIS YEAR, will my rental costs approach equaling the costs of owning a home.  That is food for thought, I think….and worth  sharing with the world that  the decision to buy or rent involves MUCH more that current interest rates vs. current rental rates.  It involves assessing who you are and what place you hope to hold in the world that is before us – not the world of our parents that has passed.


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