Why Buying Property Is Not Always the Best Idea
There are numerous instances where owning a piece of land is detrimental to a person’s potential net worth and quality of life. The following are three major factors that might dissuade someone from taking the plunge into home ownership.
Ori Tal a real estate investor says “the best time to buy is when the market is low.”
Due to the fact that the total buying and selling process can easily take over a year, owning a piece of property is not for the fleet footed. Considering the current market trends, the ability to move quickly is vital if one wishes to maintain steady employment and advancement in any given industry. Buying a home only makes sense if the owner is guaranteed to be staying in the same area for a long period of time.
Total Cost of Ownership
Owning a home comes with numerous upkeep challenges, all of which may come at the worst possible moment. If the roof needs replaced, it will need to be done by a professional team like ABC Roofing the second the owner is between jobs. That tornado barreling down the street? Why, the insurance agency had just cancelled your policy. In short, if you own it you are required to maintain it.
Tie-up of Capital
Purchasing a home requires a significant deposit of the total cost. For the average home, this can easily be over twenty thousand dollars. That is money that will not be working for you, stuck in an asset whose growth barely matches inflation at the best of times.
It can take several months to reclaim this money, and in the process you will be forced to move or have additional expenses on top of your monthly bills. This is not good, especially during a time where most people have little to no emergency savings. It is better to keep the money close at hand, rather than have it tucked away where it will be of no use.
It is the American dream to own a home. That is one of the few truths that still exist in our nation. However, practicality must take precedence. Keep an eye on the bottom line, and know when it will make more sense to rent a home, rather than purchase a piece of property that will cost more in the long term.
By keeping yourself free, it is possible to take advantage of opportunities that homeowners cannot easily handle. Keep the cash, and grow your net worth.