Essay about Benefits of Home Ownership

Submitted By babasai
Words: 1860
Pages: 8

The American dream is as diverse as the American people. Freedoms of all types were sought after during the formative years of America and arguably the same freedoms are still pursued today. We want the right to worship as we will, the freedom to make our own way, and we don’t want to be weighed down by government, and we still want to provide a better life for ourselves and our posterity. Land was once a crowing accomplishment whereon a family could build their homestead and while the quest to own land is not today what it once was, the desire and even need to own a home, an anchor in family history, is no less important than in days gone by. The season is ripe for home purchasing with property values as favorable as they are and interest rates at record lows, yet softening in the real estate market comes at a price and with similar softening in income coupled with uncertainty in job stability, now is arguably a better time to lease for many. The pressure to jump on the opportunity to own at a low price is real but, with careful consideration one may discern as I have that my harvest will come later in the season.

I like most Americans expect to find that purchasing a home will come with responsibility and financial burden that is a great deal different than the burden of simply leasing a property for my family to call home. There are pros, cons, and trade-offs worthy of consideration in making the decision to purchase or wait. Sacrifice will need to be maid and I must decide whether the gravity of the sacrifice is acceptable or more than I am willing to shoulder. A careful review of what I am willing to give up and the cost in doing so to achieve my desired gains are the first principles of economics to occupy space in my mind. I feel fortunate that I don’t have to study and make such important decision on my own, fortunate that I have knowledgeable family members in whom I trust that I can consult with which leads me to the third principle that has affect on my decision. Rational thinking in this case is more than making a cautious and calculated decision, it is the product of being wise enough to study what I can and temper my research with the wisdom of others who have long since wrestled with similar decisions, who have lived their decisions and are willing to share with me. Greed and neglect are key contributors to the frailty of our economy today and in particular to the weakness in the real estate market today. However naïve the government was in neglecting to regulate the industry I firmly believe that the government has a role in improving the market. Today we realize that role in the form of stabilization efforts and attempts to replace lost consumer income with new and better paying jobs. As our foothold becomes more solid and more inertia is found in the recovery I expect the government’s “invisible hand will continue to works its magic via enforcing of the rules” (Mankiw) and expect further that the government will create incentives to entice potential homebuyers to take advantage of still favorable conditions.

Want and desire for home ownership is influenced by ones perception of benefit in ownership. From a young age many are taught that owning a home is significant in preparing for and creating ones long term financial stability. As we progress in our earnings ability we learn that home ownership becomes almost an essential component in our ability to maximize the usefulness of our earnings. In other words we are able to do more with our money when we spend it in ways that the government has provided incentive. Unfortunate for many, the economy today has a significant and negative impact on our ability to exercise the right of ownership, the desire for ownership, and our right to capitalize on the marginal benefit of ownership. Low home prices and money available for loan at interest rates closer to zero than they are to historic averages means the marginal benefit of home ownership is far superior to