There is no shortage of ways to invest your money, but the real challenge is finding an investment
that is going to give you a good rate of return and that is going to strengthen your future financially.
Not everyone has extra money to invest as for many finding the right place to live and raise a family becomes the primary concern. What many don't realize is that this investment into a home can be just as important as what a investment portfolio would be. In many cases it is also a much more solid and secure investment.
There are a lot of success stories where the average working
person has been intuitive enough to not only use their primary residence for padding their future but buying additional property to really scale up the finances for the future years.
Success Story One
One great example is for a family of five existing on one income. It is a classic example of "belt tightening" for a year or two but still having a home to live
in and the average family needs met. In this example it was the man of the house that was the sole bread winner and was existing on an average income. By cutting back on things not considered to be a necessity and making every penny count, this family not only had their own residential property to enjoy but was also able to invest in a rental property. The income from the rental property
was used to pay down the debt. The moral of this story is even if this fellow did nothing else but held onto these two properties for several years they are building a long term and solid asset.
Success Story Two
This next example depicts an investment in property that nobody else wanted and although it refers to property outside of the USA the same concept can still be applied when purchasing your own home.
This story revolves around Sir Richard Branson who made an investment in the Virgin Islands when at that time nobody wanted that property. It turned out later to be a gold mine for investment purposes.
The Naysayers to Home Buying
Just as there are success stories there are plenty of stories popping up as to why investing in a house has become a horror story for many. This is frightening and when you read the titles of some of these articles that may be all it takes to turn you off from investing in a home. If you don't go on to read the rest of the article then you may never learn about the pitfalls that caused them to have such a bad experience with home ownership. It may be that they were not savvy house shoppers, and perhaps made the following common mistakes....
- Buying a house that was beyond their budget
- Buying a house in an area that had no future potential
- Not looking realistically at what the other expenses are that come with home ownership
- Not willing to sacrifice financially in order to pay down their mortgage at a faster pace
Some of the naysayers about investing in a home look at it over the long term as to the interest rate and the cost of home maintenance for example. What some in this category of being against home buying
may be forgetting that an average family of four has to live somewhere. So at the very least if renting is the option then it would have to be a two bedroom apartment.
For example, an average two bedroom apartment in Atlanta, Georgia
currently runs at $1,700. per month. Assuming that it never went up over 30 years a family of four would end up paying $51,000 in rent. If one were willing to move less than a 1,000 miles away say from Atlanta to Madison Georgia one may be able to find an excellent deal on a two bedroom home for less than $10,000. on a quick claim deed.
While home deals that are this exceptional may not be easy to find, it doesn't mean that with some careful house shopping and the willingness to make some compromises that buying a home isn't a great investment. Especially if you compare the price of the home now and what it would most likely be thirty years from now.
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