..It just feels that way.
I’ve been a Realtor since 1987 – with the odd break for childbirth and one ill-advised foray into the corporate world – and I’m here to say that I’ve never seen a scene like I’ve seen in the last month or so. It’s a site! A hot mess.
So, what does this mean to erstwhile home buyers? That buying a home is a risky endeavor? That the chance has passed you by? That you were silly for even thinking that buying was for you? That owning a home is for Grown Ups?
The answers are, in order: yes, no, no and yes.
Yes, home buying is risky. So is car buying. And iPod buying. You lay your money out and encounter risk. But the ridiculous lending practices that wormed their way into our otherwise conservative financial culture notwithstanding, buying your own home remains a good idea.
Why? For one very good reason, one has to pay to live somewhere. One might as well pay for one’s OWN mortgage. Because – believe me – if you’re paying rent, you’re paying someone’s mortgage. A landlord undoubtedly has a mortgage. And the tenants pay it.
The other is that there is really a great feeling to walking into your own home. Your own walls. Your own floors. If you want to paint your bedroom you can go ahead and do it. Feel like planting hydrangea in the front yard? Go for it. Do you love pale green shag carpet? Install it. (Then look at the calendar and realize it’s no longer 1972, but install it all the same)
The nauseating news about huge mortgage companies going belly up has nothing to do with the benefits of home ownership. It has to do with poor lending practices and fraud. An ugly word, but accurate.
The old, boring standards for what it takes to make a mortgage work for you still stand. There are sensible lending requirements that any good, reputable lender will look for. And that you should require of yourself – it just doesn’t make sense to live beyond your means – and if you can meet those requirements things are not so scary. Interest rates for conventional loans are still really good – around 6.5% – and all the tax benefits and emotional benefits of home ownership still apply.
The news is wild. But home buying isn’t. Exciting? Yes. But “wild” it doesn’t have to be.
