Most real estate articles zero in on the financial benefits of home ownership. After all, buying a home is a big decision, and it makes sense to talk about mortgages, taxes, home prices and so on. Yet according to a recent Gallup Poll, home buying has as many psychological and emotional motives as financial ones.
Here are the top home buyer motivations expressed by the poll, along with my own thoughts:
Home ownership is an investment. Despite the loss of equity that happened during the housing bust, the long-term opportunity to build equity and come out ahead of the market still holds tremendous appeal.
Home ownership provides personal financial security. With fixed-rate mortgages below 4% for a 30-year loan, and below 3% for a 15-year loan, mortgage payments can be cheaper than rent, even with taxes and insurance factored in. And if you go with a 15-year loan, you could be mortgage free by the time your kids go to college, or before you retire.
Home ownership improves your credit. This is more than just an opinion. Whenever a creditor asks you if you own or rent your home, it’s because they use this data in evaluating your risk profile. Being a renter doesn’t mean you won’t get the credit you apply for, but it could influence the rate you are offered.
Home ownership provides a better family environment. Renting has uncertainties because of things like frequent changes of tenants, and changes in landlords or property managers. Changes in lease agreements, rental rates and tenant rules can be unsettling. Most apartments are also relatively small for the money, compared to what you could obtain when buying a home.
Home ownership is important to personal well-being. For many people, this comes down to having control over your living situation and being able to putter around the house. Want to pound nails in the wall? Go ahead. Tear out the carpet? Go for it. The intangible factors of home ownership, like personal freedom, privacy, and pride of ownership, are a large part of home buyer motivation.
The poll also revealed that many renters would rather be homeowners, but most are unable to buy a home due to bad credit, or a lack of funds, or because of frequent job transfers. Some 57% of renters cited financial reasons as their main obstacle to home ownership. Only about 13% of surveyed renters say that renting is a choice, made for convenience reasons or due to the downsizing of the household.
Are you ready to become a homeowner? Let me help you! I will refer you to trustworthy mortgage lenders, and I will help you find the ideal home for your needs and budget. Please feel welcome to contact me for the latest home listings in Livermore, Pleasanton or Dublin. I’ll answer all of your questions, and provide you with expert guidance!
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