The Pros And Cons Of Homeowners

When the recession hit America in 2008, the effects were brutal, sweeping across all 50 states, resulting in lost jobs, economic hardship, and a decrease in the standard of living. However, no sector was hit as hard as the real estate market, and thousands of Americans lost their homes. Now, as the economy has started to recover, many of those who lost their homes are looking to get back into the homeowners market, and have started searching for a place to own. Home prices are still stunningly low; there is an ever-growing worry that those who lost their homes when the recession first hit will now become “boomerang buyers”, looking to own a home at the first availability, without considering all of the consequences. These prospective homeowners …show more content…
It basically works like this: the prospective buyer leases the home, pays monthly rent, but has an option in the rental contract to buy the home at any time, at a fixed price decided on when the prospective buyer first rents the home. While this option normally comes with an option fee (somewhere between $2-5000 is a good estimate, depending on how nice the house is), it does mean that the owner of the house can’t rent or sell the house to anybody but the renter, and it normally goes towards a down payment when the renter decides to buy the home proper.
The leasing option has many distinct advantages, but the biggest is that it eases the renter back into being a homeowner, while still keeping them afloat, financially speaking. This slow easing can help the future homeowner to avoid becoming a “boomerang buyer” and to be more financially secure when they’re ready to purchase the house. This time can also help the future homeowner in other ways; it will give them time to build back up their credit, save for retirement, establish employment, and to make sure that the house is both what they want and what they