A couple of weeks ago, over dinner with a friend, conversation shifted towards houses and mortgages. I was explaining what my job entailed as a data analyst at a mortgage servicing company and she was describing her new house she just closed on.
It all got me thinking about my stance on home ownership.
For the longest time, I’ve been against it. I have a blog post bookmarked from March 2011 outlining reasons why the author is never going to own a house again. Just last month, my mom sent me an entry from a Forbes blog listing 11 reasons the author never wanted to own again.
But after the dinner conversation, I mulled it over. My friend’s house was in an excellent area (read: low crime rates, rich white people, stable property values). It was affordable, with town home base prices starting at $170k and typically selling for $190k-$210k. It is new construction. It’s near both a green way and a city park. It is roughly 5 miles from where I work. Did I discover a chink in my anti-home-ownership armor?
On Saturday, I decided to dip my toe into the shallow end. I headed out to the development to pick up some information, get some questions answered by the salesperson, and take a walk through some of the models.
The floor plan that caught my eye was a three bedroom, two and a half bath, two story town house that went from 1,491-1,564 square feet. I loved that there were three bedrooms.
One of those definitely had “game room” written all over it. I was already envisioning a comfortable couch, a huge wall-mounted TV, paraphernalia from Clemson, video games, and movies, surround sound, and a fun color scheme.
I loved the layout of the kitchen and living room too. The one thing I miss about living in Raleigh is my apartment. It had plenty of room to spread out and be comfortable, whereas my apartment here in Charlotte is a little more conservative on its space. The layout in the town home definitely had room to play with.
To provide some semblance of individuality, the facade of each town house looked to be somewhat customizable – whether it be brick, stone, or vinyl. Uniform but different.
Unfortunately, the “sales counselor” was busy with scheduled appointments, so I didn’t have a good chance to sit down and ask my questions. But on the other hand, it gave me pause and let me sleep on a decision, think up a solid set of questions, and run everything by parents before succumbing to a gigantic impulse purchase.
Which can only mean one thing… A list!
|-I can afford a 10% down payment on a $170k-$210k house||-I cannot afford a 20% down payment, resulting in mortgage insurance|
|-There’s a clubhouse, gym, pool, and green area I could walk Harper||-They want a ridiculous $200/month HOA fee and I’d never get my money’s worth|
|-Walking through the model, the sense of pride in owning your own house is extremely convincing||-Just not convincing enough to cost $1500+/month (PITI + HOA with 10% down, 30 year fixed at 4.5%) when my current rent is under $900|
|-I’d have plenty of room for a second dog||-I’d also have to spend a ton of money to fill that extra room|
The reason almost always given for owning a house is that you can “save” money by writing off the interest on your taxes. But that may save me $1500 a year maybe. Guess what? All of the money I just saved – plus roughly $1000 more – will go into HOA fees. So the largest financial reason given for owning a house has just cost me money. That doesn’t take into account closing costs, buying the large appliances (washer, dryer, refrigerator), the additional cost of homeowner’s insurance over renter’s insurance, any repairs, and extra, unneeded furnishings. Not to mention my savings account is instantly wiped out to cover the down payment.
All of the pros seem to be sentimental, comfort reasons whereas the cons are all focused on how much extra money I would wind up spending on things I would never see a return on. Unless you plan on settling down in one place (I’m not) or have children (I don’t), I can’t wrap my mind around why people buy houses instead of renting. It simply costs too much money.
So the consensus seems to be back in the “never own a house” camp for the foreseeable future. I’m not sure why I ever doubted my gut instinct in the first place.
P.S. – Does it count as an MTV Cribs entry if it’s not actually where I live?