Purchasing a Home: Panacea or Pandora’s Box?

Andrea Schmutz, M.S.
USU Extension Assistant Professor

​ One year, my sister’s family embarked on a crusade to celebrate as many national holidays as possible. They celebrated everything from National Cheeseball Day to National Step in a Puddle and Splash Your Friend Day. It wasn’t always easy, but they found something to celebrate almost every day for a year. Now, whenever I hear about a national day or month celebration, my thoughts immediately turn to my sister and the fun her family had that year. 

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​June happens to be National Homeownership Month so I tried to emulate my sister and figure out a way to celebrate such a noteworthy event. I thought back to the purchase of our first home and I can remember the anticipation after submitting an offer, the excitement of turning the key and walking in the door once the deal was closed, and the thrill of staring at the kitchen walls knowing I could leave the “so-ugly-it-was-cool” fruit-themed wallpaper or I could start peeling it off without asking anyone else for permission. I also remember little surprises as I discovered the joys of home ownership such as needing to buy a lawnmower when I realized that no one else was going to come mow the grass. As I reminisced, I recognized a pattern in my thoughts: home ownership offered many solutions to some of the challenges we had been facing as renters, while at the same time, owning a home brought with it some unexpected trouble and complications. To borrow from the Greeks, homeownership was both a panacea and a Pandora’s box.
 
According to the Miriam Webster dictionary, panacea means “a remedy for all ills and difficulties.” Pandora’s box, on the other hand, originates from a Greek myth and refers to something that could cause problems if handled incorrectly. The two meanings fall on opposite ends of the spectrum - one is a remedy while the other is the cause of trouble. So, how exactly does homeownership fit into both of these categories? Let’s take a look at a short list:
 
Panacea

• Home ownership often affords more privacy than renting an apartment.
• Mortgage interest and property taxes may be tax deductible.
• While a landlord can decide to raise the rent at any time, most mortgage payments will remain steady over the course of the loan.
• The homeowner controls the decision making. You can choose to have a furry companion without asking for approval, paint a room hot pink, hang things on any wall or even knock out a wall to open up a room - the sky’s the limit! (Well, actually, the bank account may pose a limit.)
• Owning a home often means having a yard where you can plant a garden and enjoy fresh produce, which may result in saving a few dollars on groceries. Backyard space also provides ample opportunity to enjoy the outdoors which helps relieve stress.
• Homeowners can build credit by repaying the mortgage through regular, on-time payments. Rental payments do not build credit because you are not paying off debt.
• Home ownership provides stability and helps build strong community ties.

 
Pandora’s Box

• In addition to the purchase price and associated costs, new homeowners are faced with paying other fees such as property taxes, homeowner association (HOA) dues, etc.
• Homeowner’s insurance - the average cost of homeowner’s insurance is about five times as much as renter’s insurance.
• Utilities are sometimes a shock to new homeowners because some landlords subsidize or cover the cost of utilities. Also, rental spaces are often smaller than owner occupied homes which leads to lower costs for heating, cooling, and providing electricity to the space. It’s important to remember that larger spaces often result in higher monthly utilities.
• Upkeep and repairs fall squarely on the homeowner’s shoulders. Appliances can go out at any time, a roof can leak, pipes can break - a renter calls the landlord to take care of the issue while a homeowner foots the bill for all repairs. Setting aside 1%-3% of your home’s purchase price (more for an older home) each year will help cover home maintenance and repairs.
• Taking care of the yard and outside space requires time and hard work. These responsibilities are common for homeowners but are not usually expected of renters.
• Owning a home requires a longer commitment to living in a particular area when considering the expenses and effort involved in buying a home. Rental or lease agreements vary in length and afford the renter the option of moving when the rental agreement ends.

 
Determining whether home ownership classifies as a panacea or a Pandora’s box is a glorified way of weighing the pros and cons of buying a home.  You can keep the needle pointing to “panacea” and enjoy the many benefits of homeownership if you do your homework and make informed decisions when looking to purchase a home. Familiarize yourself with the common expenses incurred with homeownership, ask questions, make a plan to incorporate maintenance funding in your budget, and look at homeownership as a great adventure.
 
Parting thought: “The ache for home lives in all of us, the safe place where we can go as we are and not be questioned.” — Maya Angelou