Is Buying a House Now Out of Reach?

Maxwell House Coffee seems to think so with their temporary rebranding. I think the bigger question is, why is much of the media trying to convince us that home ownership is beyond the average American or should not be desired or even considered? Media is about selling not only a narrative, but also stuff. It tries to convince us to buy expensive coffee drinks, the coolest gadgets and phones and that luxury car that can take us to amazing places in style. The media and social norms have raised our standards of living to unsustainable heights. And we let it. Why is it ok that phones are over $1000, that a car has to cost what houses used to cost 10 years ago, and a college education should put us in debt for 20 years?

But we can fight the social norms and contrive our own standards of living with some discipline, financial literacy, and a plan. We have to prioritize and spend our money with purpose. We need to understand economics and the fact that the housing market has cycles. When I was first looking at houses back in the 80's, the interest rate was 12%. And we need to understand that location is key to not only housing costs, but also to taxes. I know this county is facing an increase in personal property taxes. But to be honest, it helps to contrast and compare what other counties are facing and dig into what is behind the numbers. I won't get into the fray here, but here is a link to an article that shares what some counties in the state pay for housing and for property taxes to allow you to compare and contrast.

So where to start? First consider that owning a house and paying a mortgage is one of the surest ways to build wealth. The money you pay every month on your mortgage builds equity you can borrow against and will provide a down payment for future homes should you decide to move. Renting, on the other hand, is like throwing money money down a hole. Rent costs are often very close to a monthly mortgage payment in most markets. It does not make a lot of sense to choose to rent over the long term. Look at many possible markets in and around where you are working. Driving 15 minutes more can open up much less expensive options on housing, getting more house for your money.

Getting the down-payment is the biggest challenge for most. One needs to evaluate where their money is going to determine how to save. What are some of the biggest expenditures? Transportation is one. One way to reduce is to buy a used vehicle and not a new one, and keep it in good repair. Keep that car on the road for as long as you can, to reduce or eliminate a car payment. Another is food. Cook at home and pack your own lunch. You will save on the out of pocket expense of eating out and you might reduce your waistline as well. Vacations. Get creative. Go in with extended family and friends to share the expenses of a trip. Try camping over hotels, or a nearby state park over a destination that requires flying. Phones. Find a cheap plan and upgrade your phone rarely. And when you do, get last year's model, not the latest and greatest. And finely, get rid of as much debt as possible. Pay off the credit cards starting with the one with the lowest balance. Once paid off, take that money and apply it to the one with next higher balance and so on.

There is so much more information I could share, but I hope this will get you thinking about the possibility of home ownership and what it can do for your future economic success and also for your quality of life for you and your family. When you buy a home, you invest in your community. You have skin in the game which influences you to take part in bettering your neighborhood, taking part in school and community functions, joining a church, getting involved in local politics and business organizations. It helps to build a life. So don't let social media scare you. Home ownership is possible. And for more financial information. the literacy program is hosting Benchmark Community bank on November 6th at 2pm here at the Crewe Library for a financial and budgeting workshop. Please plan on attending and bring your questions. See you there!