Is Owning a Home Still the American Dream?
By Kristin McGrath
April 27, 2012
I’ve lived in seven apartments over the past five years. That means, every eight months or so, I’ve packed my stuff in boxes, bribed friends with pizza to help with the heavy lifting, and started from scratch with clean carpeting and bare walls.
Now that I’m just a couple years shy of 30, this nomadic lifestyle is starting to concern relatives who remind me that now might actually be a good time to buy a home. For those who qualify for a loan, mortgage interest rates are at an historic low. Besides, why throw all that money at rent, when I could invest it in finally becoming a grown-up?
For now, though, renting feels safer. I feel so lucky to be debt free (for now), and my finances are pretty simple. Although having a semi-permanent roof over my head sounds nice, having a mortgage hanging over my head does not.
A friend of mine couldn’t move into his dream home because he couldn’t sell his old one — after it was on the market for nearly a year. If I hate an apartment (or just want to try a different neighborhood), I can simply move when my lease is up. Best of all, if something breaks, I simply use my apartment complex’s online maintenance system, which summons someone to fix the problem for free.
I’m not the only the only one who is sold on renting. Home ownership is declining, according to Pacific Investment Management Company (PIMCO). That decline could transform 4 million homeowners into renters. For many who owned homes when the housing bubble burst, renting is becoming a way to nurse their finances back to health. Meanwhile, the next generation of homeowners (Generation Y) is deep in debt and spooked by the recession. As a result, it’s renting, not owning, a home that’s increasingly being seen as a responsible move.
It’s not that I never want to own a home. In fact, owning is probably the best option if you want to have as many dogs as I want to have, want to customize your home, or want to plant a garden that’s bigger than a planter on a balcony and a sad-looking house plant. I also dread the inevitable triple-digit rent increases that come with living in a growing city like Austin, and I’ve known the frustration of being kicked out of a rental house when the owners wanted to sell it.
For now, though, I’m content to hit the snooze button on the American Dream and continue apartment-hopping.
With financial milestones in mind, here are some of the best money blog posts of the week:
Man vs. Debt invites readers to discuss the pros and cons of renting and owning.
Girls Just Wanna Have Funds challenges the idea that owning a home is always a savvy investment.
Evolving Personal Finance explores the complexities of spouses keeping separate bank accounts.
20’s Finances wonders why so many Americans are addicted to buying new cars.
Get Rich Slowly shares the best ways to buy a new car.
Frugal Dad provides some tips for planning a budget wedding that doesn’t look like a budget wedding.