There are some people that have not purchased a home because they are uncomfortable taking on the obligation of a mortgage. Everyone should realize that, unless you are living with your parents rent free, you are paying a mortgage - either your mortgage or your landlord’s.
As a paper from the Joint Center for Housing Studies at Harvard Universityexplains:
“Households must consume housing whether they own or rent. Not even accounting for more favorable tax treatment of owning, homeowners pay debt service to pay down their own principal while households that rent pay down the principal of a landlord plus a rate of return. That’s yet another reason owning often does end up making more financial sense than renting.”
Also, if you purchase with a 30-year fixed rate mortgage, your ‘housing expense’ is locked in over the thirty years for the most part. If you rent, the one guarantee you will have is that your rent will increase over that same thirty year time period.
As an owner, the mortgage payment is a ‘forced savings’ which will allow you to have equity in your home you can tap into later in your life. As a renter, you guarantee the landlord is the person with that equity.
No matter what stage of life you are in, owning makes more sense than renting since home values and interest rates are still at bargain prices. If you believe that your FICO score is too low to qualify for a mortgage, you should visit with a mortgage broker and learn just what you need to do to qualify. If your credit has been affected by a bankruptcy or other factors, here is a good article on how to repair it.
Berkshire Hathaway is a leader in the luxury market. We are the Number 1 company in Barron’s annual ranking of the world’s most respected companies, and stand at Number 8 in Fortune magazine’s “50 Most Admired Companies” survey. Currently, Berkshire Hathaway sits at Number 18 in Harris Interactive reputation study of the 60 Most Visible Companies.
Plain and simple, Berkshire Hathaway seeks value. Its approach is to acquire companies with great brands, great products, strong leadership, and hold them for the long term. The company, with its diverse holdings, is said to cover consumers “head to toe”. Real estate fits perfectly into this strategy.
“When people are making the decision of the magnitude of buying a house, it’s the biggest decision a great many families will ever make. They want to know who they’re working with and we think that the Berkshire Hathaway name will be reassuring to many of those people.” - Warren Buffet, Chairman and CEO, Berkshire Hathaway Inc.