Is owning a home all it's cracked up to be?

This came to mind after reading a recent New York Times article on the state of the housing market and a bit of self-assessment. Owning a home has always felt quite distant to me, partly because of the transitory nature of working in newspapers and partly because of being a leaf on the wind in general (I've moved house 21 times since graduating from high school in 1999, and most of those were long-distance moves). Even so, I can't help but wonder if it's something I could -- or even should -- pursue eventually.

Most of the evidence seems to suggest home ownership is not in my future. I have almost no credit history (having avoided credit cards entirely) and even less cash, the latter due in part to getting screwed out of $15,000 in retirement savings and another $15,000 of wages by a former employer. Urban areas -- where jobs tend to be -- are expensive and only getting more so, and asking prices for rentals (national median $951) and for-sale units ($196,800) have been on a steady upward trend. Reports like the aforementioned NYT one and others don't fill me with a great deal of hope, either.

I could well be misinformed, though. I've been out of the country for 10 years and only hearing second-hand reports (at best), so I might not have a good picture of what life is like on the ground. Are things that dire for people in the US who want to own a home? Is it worth all the financial risk and opportunity cost? Having a place of one's own certainly has an allure, and that's in addition to all the benefits the US provides homeowners. I imagine it would feel odd, though, staying in one place for 10, 20, 30 years or more after for so long being able to pick up and move at the drop of a hat.

 

I'm in a similar geographic position. Not based in U.S. but want, eventually, to be back in America. Debating buying now; I'm currently in a position where I'm making money hand over fist and have a total of $90 a month in expenses. No better time financially for me to buy, but I keep wondering if it's a stupid idea. People say it's a solid investment, but both times I've bought previously I've taken losses. One was a condo and the other was near Detroit when I bought at the very top of the bubble. HUGE loss.

In the four years or so I've been poking around, home prices have shot up in the ZIP codes in which I am looking. Part of me freaks out and wants to lock in now but another part is sure there's going to be a crash and values will normalize.

Another wrinkle for me, and might be for Troop, is if I bought now I'd be looking at renting it out for 10-15 years. I don't know if that's a good idea, but if the whole market crashes and I lose everything, my thought process is at least I'd have a paid-for house.

I waste a lot of time on realtor.com.

 

I didn’t buy a home until I got all the wanderlust out of my system.

Now that I’ve owned two, I can say unequivocally that owning a home is a royal pain in the ass.

But, when you move, you’ll get money back. So, there’s that.

I live in an area that’s super expensive, but it’s also pretty close to a sure thing that my house will never LOSE value. We’ll never get back what we’ve put into it to make it our own, though. Which is fine.

 

Owned my home for 30 years. Nobody who isn't wealthy could move into Boston area with no existing equity. If I want to live here, and I do, I really can't afford to sell it now, even though house is worth ever so much more than purchase price and is all paid for. The apartment in Cambridge where my wife lived when we first met is now a condo selling for several hundred thousand dollars more than my house's value in a nice suburb.

 

I never thought it was a big deal. I love it- but I loved my tiny shoebox of a condo just as much.
My house is a security policy for our children.
If they play their cards right they will be in very good shape with this place.
And I will be handing it off completely to them when the time is proper, washing my hands of it and vacationing in St. Tropez while they figure out what the hell to do with it.

 

All I can say is, "What is your end game?"

Do you really want to be paying rent through retirement, until the day you die?

If not, better think about owning a place and building some equity. And it sure is mighty easy to contribute 20+ percent to a 401(k) without those monthly housing payments. Saves a bundle in taxes AND helps fund a comfortable retirement.

 

I always thought I never wanted to own a home because of upkeep, but doing homework when buying and finding one where the roof, heating and cooling system, wastewater system and foundation were new or in perfect condition really alleviated my concerns in home ownership — for a decade or so, at least. And it helped having an electrician for a brother-in-law who could rewire the whole house up to code for pennies on the dollar, too.

I actually enjoy the minor upkeep of a home — mowing, landscaping and cleaning. It's things like a roof needing replaced or needing to dig up clay tile in the front yard that gave me nightmares. Spending hundreds of thousands of dollars and still needing to do tens of thousands of dollars in repairs scared me.

 

That's a complicated question and depends on a lot of things like geography and life situation. Generally speaking if you're confident you're staying somewhere at least five years, you can afford the payment (duh) and are reasonably sure the house won't tank in value, it's not a bad deal to own. But I'm in an area of the US where housing is pretty reasonable. That's obviously not the case everywhere.

 

I should add that while houses are a constant budget drain (stuff wears out, there are storms where things hit your house, etc.) the psychic rewards are real. This is where our children were raised. This is where my life happened. That's worth one hell of a lot to me.

 

In fairness, market swings are not something I had to worry about. In the Boston suburbs, prices never go down. All that changed in 2008-2010 was that they were on the market longer and prices stopped going up.