So many people and media outlets tell you that home ownership is the way to wealth. That’s the first lie. If you ask the average homeowner if they feel wealthy they will likely say no. Wealthy individuals own homes as a byproduct to their financial success not because they purchased a home to live in. That’s like a company saying let’s buy a building just to put our staff in for 8 hours to chill even if they aren’t making the company any money. The building is used as an asset to operate a business that will bring revenue.
Your home on the other hand has expenses that don’t generate revenue. Of course you can Airbnb the home or something similar but just owning it to live in doesn’t make you wealthy.
Becoming a homeowner does not somehow change your spending habits or make you a better investor.
There are thousands of homeowners living paycheck to paycheck. There are hundreds of thousands of homeowners that do not have at least $100,000 in assets outside of the value of their home. I don’t consider that to be wealthy.
Think about how many of your friends and family members whom are homeowners. Are any of them wealthy? If any of them are wealthy, is it because they own a home? Or is it because they made money in whatever profession, business or investment they are involved in?
Don’t fall for it. Buy a home to live in that you can afford comfortably. Homeownership can make you broke. Buying an expensive home or one bigger than you need will make you struggle. So many people work just to hold on to a house. When there is a repair that’s needed many homeowners can’t afford the repairs. I ask. Is this wealth?