Do I really want to buy a house?

I finally went to my first home ownership/financial literacy class the other day. I had been told by people who had been through these classes before that I should expect to be the highest functioning person there. I was surprised to find a wide-ranging diverse group of 12 people and one dog. There were men and women; mostly people of color, but there was one white male. The classes were held at the Community Housing Development Corporation of North Richmond (CHDCNR). These folks seem to have done quite a lot for that community in Richmond. Not only are they providing first time home buyer and financial literacy programs, but they also have actual homes for purchase in that community. If I chose to work with them, I could do all the steps to buying a house through them. The benefits include not having to deal with strangers, but the drawback is that I would be living in Richmond, and to be totally honest, I grew up in a city like Richmond, so I have no real desire to go back.

The class itself was scheduled for two hours, 7-9pm. We started late but still ended on time. The group that participated in these classes seemed to be quite diverse. It was mostly people of color, and the age range was huge: everyone from young people in their mid 20's to older people who had been renting for most of their lives. To be honest, I found all that to be comforting. I didn't feel out of place, and the vibe of the class was pretty relaxed, something not unlike the first day of school.

The first question that was asked was, "do you really want to buy a house? If so, why?" The group started listing reasons why it was a good idea to buy a house. One reason that jumped out at me was the tax write-off incentive. What that means is that you can write-off the interest of the mortgage, not the principal, in your income taxes…up to something like 80% of it. What that boils down to is I would pay fewer taxes in April. It turns out, that owning a house can actually help you pay less tax to the government. I pay less taxes, I keep more of my money.

One other thing that we discussed at length was that if you are coming from a renter’s perspective, your monthly living expenses will probably triple. That piece of information, dropped on the class like a hundred pound weight. The realization that “if you're barely able to make it paying $1,000 a month then how are you going to handle paying $2,500??” is very sobering thought.

"Still want to buy a house?" the instructor asked. There was a less than enthusiastic utterance of yes from the group. Then she passed around a hand out and said "here is your homework." It was a sheet with a list of all kinds of household expenditures, and a line for what you thought you spent vs. what you actually spent. We then were asked to take it home and put down what we thought we spent per month, and then gather all the bills and receipts we could find and put down the actual amount we spent. We would go over it next week.

So, that's what I will be doing for the next few days. I will let you all know what I find out.