Tuesday, November 17, 2015

Home Ownership vs Renting

A lot of our friends are in the house buying mode as of late, and it's safe to say that Rob and I are in the minority.  I'm a bit tired, however, of hearing how buying a house is a good investment for the future, and renting is just throwing money down the toilet. 

Our friends often share proudly how low their mortgage is per month and then ask us how much we pay per month for our apartment. Yeah, we get it. We're paying a lot in rent. You know what else we were paying a lot for? Interest on student loans, in excess of $200 a month! 

Don't get me wrong-- we want to own a home. I would love to have a yard or a garage. Rob dreams of the day he can have a dog. Home ownership is definitely a goal we have for the future. But just because we can't make it happen right now doesn't mean we are being irresponsible. We are going for financial freedom, not more financial bondage. To quote one of my hero's Dave Ramsey "Live like no one else so later you can live like no one else." We know we won't be in debt forever; but that doesn't mean we want to stretch it out as long as we can. 

I also believe that just because you are investing in something (like a home) doesn't always mean you get it back. A close friend of mine bought a house before the market crashed. Just four years later, he had to pay money to sell the house.  Sure, he invested in his home but that doesn't mean that he got anything back from it. Another family I know had to sell their home because they couldn't afford the roof damage caused by a storm.  

Furthermore, when you buy a house, there are a lot of hidden costs that you may not even think of. We would need to buy a washer and dryer, a lawn mower, possibly a fridge and other appliances. All things we don't need to worry about right now. In addition, you also pay a lot more on electricity, city fees, water, recycling, taxes, etc.  If something breaks or need repairs in your home, you're financially responsible to fix it. When you rent, you just report it and someone comes and fixes it at no cost to you. 

There is a time for home ownership, and I can't wait for that season. But for right now, we're in a season of renting (a predictable amount each month) and paying off our loans. Thanks Dave Ramsey! 

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