In their pursuit to find the perfect house, many renters have been surprised by how many homeowners have tried to deter them from taking the real estate plunge.
It’s no secret that owning property can be a great investment but, apparently, it can also be a challenge.
Here are 5 of the top reasons to remain a renter:
1) Hidden costs: Forking over cash for everything from property taxes, to a new boiler, to a lawn care can really add up. As a renter, you know exactly what that roof over your head will set you back each month, and no broken pipes are going to eat into your entertainment budget.
2) Tax letdown: Financial writer for Forbes Kelly Phillips Erb adroitly explains what a lot of my home-owning friends have complained about. “Those alleged tax advantages,” she writes, “not quite what they are painted to be.” Citing fluctuating property taxes and the fact that you cannot deduct a loss on the sale of your home, Erb’s article, '11 Reasons Why I Never Want to Own a House Again,' did give me some serious pause.
3) Stunted social life: Research out of the University of Pennsylvania completed post housing bubble doesn’t portray homeownership in the most flattering light: “The average homeowner tends to spend less time on active leisure or with friends, experiences more negative feelings during time spent with friends, derives less joy from love and relationships and is also less likely to enjoy being with people.”
4) All tied down: Although you may have lived in the same apartment for more than a decade, it is nice to know you can move your family to Paris with little hassle, should the opportunity arise.
5) The big debt: This ties in with #4 above. Although it has a marginally nicer name, having a mortgage is having a debt. Unless you have a lot of cash to burn, investing in a home puts you in the hole.
There are many good reasons to buy property. Topping the list is the desire to leave something substantial to children. However, being mindful of the disadvantages can help prevent you from rushing into an imperfect place.