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Is owning your own home worth it? Sit down and try to figure it out

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POSTED March 23, 2012 12:17 a.m.

Is owning a home really worth it?

I was asked that question four years ago this month when I bought a home in Powers Tract between Manteca high and Spreckels Park for $184,900.

Two years later I was asked if I regretted buying when the market hadn’t completely finished its free fall.

The answers for me, anyway, were “yes” it was worth it and “no” I didn’t regret it.

Homeownership doesn’t work for everybody nor does it necessarily fit with their future plans or lifestyle.

Every year I make an assessment of where I’m going financially and personally when I sit down to see how much money I may have to send off to the IRS and the State Franchise Tax Board.

I’ll be the first to tell you not to buy a home based only on income tax savings. That’s like spending $1,000 to save $250. It is plain crazy.

But I will tell you in the long haul it makes sense.

My yardstick is using a place I was renting that I felt relatively comfortable in. In this case it was a two-bedroom apartment at Laurel Glenn. The rent has already gone up $75 a month since I was there.

Comparing rent with my monthly mortgage cost that includes property taxes and mortgage as well as insurance, it is costing me $305 more a month to own than rent. When I first moved in it was $380 more a month to own than rent. Subtract renters insurance from the equation and I’m paying $285 more a month.

If you factor in income tax savings - which I don’t in determining whether owning is smarter than renting for the long range - the difference for me is $98 a month. As a loan winds down you get less deduction from the mortgage insurance you pay.

Taking that out of the equation and factoring in likely rent increases over the life of your loan gives you a true perspective.

I have 26 years to pay on my loan. Over the last 26 years in Manteca, the rent on an apartment similar to the one I rented went up just over $410 a month. In terms of constant dollars, I’d be way ahead of the game financially in 26 years.

Yes, there are maintenance costs but there is also the issue of paying for basic housing for the rest of your life. Say I live 10 years after the house is paid off. In terms of future rental costs I’d be avoiding close to $15,000 a year in expenses in constant 2012 dollars.

There is more to consider to owning a home than the financial considerations.

I liked the Laurel Glenn apartment. But with my own home I can have two Dalmatians, fix it up the way I want it, not worry about neighbor’s cigarette or barbecue smoke drifting into my windows, not worry about tiptoeing around when I get home at 1 a.m. from work, not having to deal with hearing the neighbors through the walls from time-to-time, have a yard I can putter in, and not worry about living by someone else’s rules since I didn’t own the apartment.

If it makes financial sense when all is said and done and you want to own a home the odds are before too many years pass if you don’t act you’ll be either forced to settle for less or get squeezed out just as people were before the housing bubble burst.

And - in my case - it allowed me to take my life in a direction I preferred.

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