They paid $60,000 in a financed full-price deal, and moved in with their two children.
Flash forward about three years. Their $60,000 home is now worth about $40,000. Their mortgage payment, though just $500 per month, is still a financial drag on this teacher’s aide and her handyman husband. It is a struggle, yet, they tell me, they would still dig deep and buy their piece of the “American Dream” today, even knowing what they know.
How can this be? They should be scrambling to get out, right? Many friends have urged them to short sale or even walk away! They are in their mid-20’s, so there is plenty of time to recover!
This couple won’t consider it! They are staying put, and riding it out. More shocking still: they don’t particularly love their home. What they love is how it makes them feel. At the end of the day, despite the numbers, despite the glug, glug, glug of their underwater home, it is their security. There is an intangible sense of peace and pride when they get home after a long day in the trenches.
They tell me if they bail on this house, the apartment they would land in for about the same $500 dollars per month would be horrid. They dread neighbors above and below them, apartment managers, pet deposits, and all of those rules, rules, rules!
It is undeniable that the once brass ring of homeownership has been tarnished by the housing crisis, but for some people, the value of home is not lessened by a home’s value.
Be it ever so humble…you know the rest!