Mesa Legend - ARCHIVES - Vol. 40, Issue 9


Volume 40, Issue 9. Today is .

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Volume 40, Issue 9.
February 4, 2003

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Investing in house smart for students
By Carly Schorman
Mesa Legend

The current state of the economy in the country is troubling many Americans. Vacations have been canceled. Christmas this year did little to lessen the strain. People are holding onto their money tightly.

With the U.S. in a dire financial situation, many have watched their investments dwindle along with the stock market. Americans do not want to spend money now.

However, a surprising trend has emerged during this economic downtime. A growing number of young people and students have begun purchasing real estate rather than renting living space. Sheldon Schweidt of Century 21 Aware Realty has “definitely noticed more young people looking for homes of their own.”

And while real estate agent Brett Hultberg of Prudential American claimed most of the people he deals with are “in their mid thirties to forties,” Schweidt felt the range now was “between the ages of 25 and 40.”

Why are students choosing to purchase their own property?
“The stock market goes up and down which effects (other investments),” Schweidt alleged. “The home buyer’s market continually goes up.”

MCC student Angie Landhuis decided to purchase rather than rent. Landhuis pointed out that her “neighbor’s home has gone up almost $20,000” in recent years. As for her own home, Landhuis said she “expects it’s gone up at least $10,000” since she moved in less than a year ago. Landhuis and her fiancé share the three bedroom condo where they live and have been remodeling it.

“A lot of people are moving into the valley. Especially the east valley,” said Schweidt. As an area grows, its property values also grow. “Values will continue to appreciate.”

Hultberg pointed out that “You can’t go wrong (when buying a home). Values haven’t depreciated in the past 30 years. It’s kind of a slam dunk.”

The cost of monthly mortgage payment is often comparable to renting an apartment or house. “Instead of paying for rent, they can actually buy and pay less,” Schweidt asserted.

Landhuis agreed, stating, “I had a two bedroom, two bathroom apartment with a friend. I almost paid more then.” But it’s not all roses and sunshine.

“If something happens like the air conditioner or heater or something breaks, we’re responsible,” Landhuis explained. “Over the summer, our air conditioner broke a couple of times. We have homeowner’s insurance and they were supposed to take care of it, but they just kept fixing it and it would break again. We had to replace it.”

Landhuis also expressed concern many have when purchasing a home with someone, “The downside is if our relationship fails, we’re in a tight spot.” Moving also becomes more difficult once you purchase a home. Additionally, evictions and foreclosures are at an “all time high” according to Hultberg.

“There’s been a definite rise in evictions and foreclosures. More people are delinquent. Big rise in foreclosures in the next years,” Schweidt maintained. Both Schweidt and Hultberg named the reason for the sudden jump in the eviction rate.

“People are buying over their head,” attested Schweidt. “Too many people just overbuy.” Hultberg agreed. “I’ve dealt with first time homebuyers a lot. Some people just go up and beyond what they originally thought they could afford.”

One of the good points to owning her own residence according to Landhuis was “I’m the landlord. We can’t get kicked out.”
Homeowners who can not make their payments will once again be without a home.

Schweidt offered some advice to prospective homeowners, “Buy reasonable. Don’t try to get into something your parents are in or older friends, who have had more time, are in. Just buy you first home, even if it’s a condo or town home. You can upgrade later. Take a 30 year loan and try to pay it off like it’s a 15 year loan.”
“Do your homework first. Talk to a loan officer and a real estate agent,” Hultberg suggested.

A house as an investment has proven to be a stable investment in previous years. “In 10 years when we sell it, we’ll make some money,” Landhuis declared.

Ultimately, Landhuis prefers owning to renting for one main reason...“Rent was always a hollow thing. Paying mortgage is buying something. You’re paying for your own house.”