Are Household Shelter Costs Increasing?

There is so much more to homebuying than just being able to afford it in the moment. It affects every aspect of a person’s life as it is a long term financial decision and a lifestyle choice. Focusing on having the right sized down payment, earning enough money in the prior two years to show the bank you can afford the mortgage payments, and having a high credit score so you get a good interest rate are the details that will get you in the house, but there’s more to moving than that.

Renters’ Interest In Home Buying

Home buyers want to set down roots which allow them to start a family, while renters want to have flexibility. If you rent and have kids in school, it won’t be easy if the landlord wants you to move out or increases your price. If you get a 30 year mortgage, you need to not only have a steady job for the past 2 years to afford it, but also keep that steady income for the life of the loan. In general (rule of thumb), you need to live in the house for 7 years before moving for it to be worth the costs associated with buying such as closing costs and moving expenses. It takes about 50 days on average to close on a home purchase, so doing that every few years is far from ideal.

As you can see from the chart above, 36% of renters stated home ownership means fulfilling a dream and raising a family. The concept of the ‘American dream’ is owning a home and starting a family. While there are many ways to achieve dreams and having a goal just because it’s in the national ethos isn’t ideal, owning a home grants you more autonomy as you can make renovations as you please and you can stay in it as long as you own it and pay property taxes. The group that wants to own a home is more likely to have kids, has higher income than renters overall, and is younger.

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