Homeownership.
This is a big one. Especially for me.
I grew up in a house that moved every four years at a minimum. I never lived in one place longer than that. I am perfectly happy being nomadic and moving around and enjoying all that life has to offer.
I read an incredible article a while ago about why people in New Zealand are so wealthy. They have a per-capita home ownership rate that is the lowest in the world, they mostly all rent, and they can move around to new opportunities and jobs and are not stuck in one place.
I think that is pretty amazing. And it made me decide a few years ago that home ownership was not for me. All that maintenance, homeowners associations, all that jazz. I was going to link to the article, but it no longer exists in any of the searches I tried.
Well, this year my son entered high school. And that radically and immediately changed my thinking. I am stuck here for at least the next four years. I pay $1223 a month for my apartment right now. Last year my rent increase was $25 not including taxes. Add another $25 or $30 this year and wow, that is really a lot of money. And what am I getting for this money? I have a 2 bedroom apartment, with two pools, a hot tub, and filthy carpeting that I hate. I have a 14 year old who is 6'2, and a dog, and a cat. I have enough stuff to comfortably furnish a house twice the size, mostly stuff I just can't part with leftover from my first marriage. My son can't go swimming alone because, while the posted age for this is 14, the front office has the lease set for 16. With no real land in here, just all parking spaces, that leaves my son in here driving me bonkers and making a mess every day. There are no kids his age outside, probably because their parents don't want them playing in traffic either.
I can't have a garden. I have tried everything to grow vegetables in here, and nothing will grow. Everything I bring in here dies within a day or two. Everything. Even flowers.
So, this year my lease is up January 16th. I know at that time I will be forced to either pay more for this apartment than it is reasonably worth, or move somewhere else, where I can get a drastically lower rent for the first year, and then play the increase game again until the apartment becomes more costly than any reasonable person would pay, again. Did I mention I have enough stuff to furnish a house? Mobility is really not my thing. Moving is herculean for us.
I realized that I can buy a home using my VA home loan for $0 down. And upon figuring out the numbers, my mortgage will be fixed at the same price for 30 years, the same price I am currently paying for this apartment. No moving. No stressful rent increases. And, with a little intelligence, a much nicer place and a pool my son can actually swim in without me needing to go roast myself in the heat and get a tan I do not need or want. I can cook dinner in my amazing and beautiful kitchen while he splashes away, no problem. My home will be 1.5 times bigger, with no carpet, and no crazy traffic. It also has kids that play outside. It is on a cul-de-sac, so they can play safely without worrying about the 800 zillion cars that are constantly speeding over the speed bumps in this place.
With all of those factors, I realized the best thing I could do would be buy a home. Lose value, increase in value, it really won't matter that much. If I decide after 5 years not to live in it, I can rent it, either traditionally or through AirBNB, as this area has times of the year when all hotels completely fill up. If it increases in value that helps my financial stability in the future, and if it does not, just having a stable mortgage with no need to move so often will help financially just as much. It really was a non-decision. Especially after I saw the amazing home I could buy for the same money.
The first thing I intend to do after I move in is start my garden. Just the savings in food alone will help immensely. Not to mention I will be the only one handling my food, and who doesn't love fresh veggies?? I also have a clothesline, the kind my grandma used to have... I plan to use that too. In this apartment drying clothes anywhere but the dryer is not an option, but I actually prefer the way clothes look and feel when dried on a line. They are flat, with no ironing necessary. I plan to use the dryer for possibly fluffing them, but that is about it.
I also have a garage. I think having a garage in Arizona is pretty important, because the heat here kills batteries and destroys tires. Not to mention paint. My car will probably last a lot longer, and that helps. The money currently being spent on my car loan will go towards the mortgage too.
After talking to my amazing loan officer (I will be writing a blog post entirely devoted to him soon, as he has been amazing - Dave Nichols, National Bank of Kansas City dnichols@nbofkc.com ), I realized that it is not necessary to take out a 15 year mortgage. A 30 year is just as good if you have no prepayment penalty. I can now decide to pay the 15 year mortgage amount without having to qualify for it, and if I have an emergency or a loss of income, I can opt to pay just the 30 year amount. Paying just $100 a month extra towards a 30 year mortgage will pay it off in 24 years. A garden with the way food prices are right now can make up $100 a month pretty easily if you grow the right things. My goal is to try and pay it off in 15 years. We will see how I do. If I do it, I will be 56 years old when my mortgage pays off. 56, with no mortgage payment and no rent, and a piece of property probably (hopefully) worth at least what I paid, that I can sell if I really want to. If things go even better, I will have a piece of property worth more than I paid. Only time will tell.
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