Keep the dreamer alive!

For most people, home ownership has long been a standard of achievement. It substantiated the attainment of the "All American Dream", a home Fee Simple Absolute. Ultimately, for most, home ownership signifies wealth, responsibility, and maturity to adulthood. For some people, it projects an image of profound independence. As children, our parents proclaim, "While you’re under my roof, you will follow my rules." Hearing that, over and over, would motivate most to want their own roof over their heads. Innately, as practically every other species or being we have shelter as a basic human need.

Once we move beyond the basic need of housing, many other benefits are realized through home ownership. The most valuable benefit of home ownership is wealth. The huge disparity between the haves' and have nots' is a result of the equity most wealthy individuals have in their primary residence. The devastating decline in current market value has decreased the equity in most homes. Despite this fact, over time, homeowners will undoubtedly reap far more value in exchange than renters. As with most markets, the real estate market is cyclical, with ups and downs. Until recently, the real estate market reacted slower to shifts and changes in the broader economy. Over an extended period of time, real estate, like the stock market has produced handsome returns for long-term investors. On the other hand renters receive absolutely "Zero" return of the funds used to cover housing expenses. Most low-moderate income individuals never realize homeownership, which certainly contribute to reduced net worth. The old 80/20 rule is probably 95/5! It wouldn't be very farfetched to believe 95% of the people share 5% of the money, and 5% of the people split 95% of the money.

As a homeowner, responsibility is like the cost of doing business. Something breaks the owner has to repair it, whether paid directly or through a homeowner association fee. Usually, residential tenants simply call the owner or property manager, and it is thier duty to remediate the faulty item. If the owner chooses not to repair the item, the tenant may choose a constructive eviction. Constructive evictions allow the tenant to terminate the lease due to the owner’s breach of the lease contract. While there are certainly pro's and con's regarding ownership versus renting, the generation of wealth and prospect of passing wealth to the next generation is possible with ownership.

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