Friday, August 13, 2010
An article was recently published in Fortune magazine about home ownership and the link to the “American Dream”. Home ownership, which once went hand in hand with the concept of prosperity in America or the “American Dream”(since the mid 1800’s), has in recent years been breaking away from that association. What was once a signifier of success has unfortunately, as of late, lead to more problems than anything else it seems. And so begins the newest trend, referred to as the “rise of the renters”. It’s no secret that renting has (maybe not any longer) a stigma attached to it, but amid everything negative happening in the housing market, it actually seems to be becoming more appealing. Renting that is. Even the Obama administration has decided to shift their focus to rental housing as opposed to homeownership. Long gone are the days of negative references to the “renting class”. There are plenty of beautiful and high-end rentals that don’t quite reflect what that terminology once used to. Most rent property and choose not to own for the simple fact that they don’t have the financial means. In today’s economy, it’s no wonder the percentage of renters is on the rise. Our economy is facing high levels of unemployment and it’s reflecting in our financials. Renting has always been a much lighter burden on the wallet and that’s why the rental market is burgeoning. Renters don’t face any getting-harder-to-pay mortgages and property taxes and aren’t spending money on maintenance. Renting is becoming increasingly popular and people are, for the moment at least, putting their dream homes to the wayside. Should people think they’re not living the “dream” because of it though? According to most, no. It’s no longer about ownership anymore. It’s about living healthy, happy and working to improve your quality of life. So whether you choose to buy or rent, make the choice that is best for you. If you need to modify your dream, then do it. Making a substitution like renting instead of owning can be just as prosperous for some. According to the Seattle PI, the Seattle real estate market reflects that it is better to rent than buy. We are ranked #3 on a list of cities with the same outcome. In short, it’s simply cheaper given our current economical conditions and housing market. However in a previous Ewing and Clark blog by COO Casey Losh, after a number of internet calculators, his general outcome was the monthly costs of renting vs. owning were essentially the same, if appreciation/depreciation is not a contributing factor. Many say that NOW is the best time to buy. Because current mortgage rates are the lowest they’ve been in decades, this is a market where first time buyers will undoubtedly benefit. However, it is better to air on the side of caution. Renting is smart and affordable in today's economy, so don't let the issue of the "American Dream" stand in your way.