Most people want to buy a house of their own at some point but, for many Americans, it is a far-fetched dream.
The total number of households that are renting in the United States grew from 31.2% in 2006 to 36.6% in 2016. It was the highest level of renting in a really long time.
Not everyone is suited to become a homeowner. Some, because of their lifestyle or the nature of their work, would rather rent than buy a house.
But, for the vast majority of the population, being a homeowner is a major achievement.
Benefits of Buying a House
Becoming a homeowner, versus a renter, has several perks. Whereas a renter, for example, is subject to the whims of the landlord, a homeowner is granted freedom.
Homeowners can decorate or modify the property as much as they want. If they want to tear down a wall and join two rooms together, there would not be anyone stopping them.
There is also the freedom from rent. Although homeowners still have to pay their mortgage or home loans every month, there is an end to it. After a decade or three, the debt will be completely paid off. They will be assured that they will always have a roof over their heads. There no longer be threats of eviction.
A house is an investment, too. Investing in real estate is always a good decision because the value of the property appreciates over time. The owner can get their money back, and more when they eventually decide to sell the property.
In addition, owning a house is cheaper after a while. The upfront cost will be high because there are taxes and fees to pay. However, many expenses associated with owning a house, like property tax and accounting, are tax-deductible. A homeowner can save money over time.
Moreover, a homeowner knows exactly how much they would have to pay month after month. A renter can only pray that the landlord does not decide to raise the rent next month.
Employers Can Help Employees Buy a House
Not everyone is capable of buying a house even if they want to. To secure a home loan, they first must apply with a lender. They must have a good credit score to qualify and prove that they are capable of paying off the debt. The long and tiring processes of shopping for a house and bidding then packing and moving cause more stress for the employee.
An employer can aid them in both small and big ways.
Part of the requirement for every aspiring homeowner to secure a mortgage is to prove that they have a job. The borrower, therefore, has to submit a verification of employment or VOE.
The role of the employer is to write it for the employee to submit to the lender. The VOE is a very easy document to make, but some companies may have existing policies against releasing employee information, especially to third parties. There should be processes in place for employees who are applying for a mortgage.
The company can also provide staff access to a real estate lawyer. A lawyer can guide an employee as they go through the purchase. A lawyer can look over contracts and offer advice on legal matters.
Employers Can Give Financial Aid
One issue that an employee might encounter during the process is securing the down payment. It is a huge amount of cash that has to be paid upfront. No wonder many people struggle to buy a house.
The employer can help by offering a so-called “shared appreciation mortgage” to cover 20% to 40% of the price of the property. Under this agreement, the employee does not have to pay until they sell their homes, at which point they, not only have to submit the balance but also a share of the house’s appreciation.
The company can offer it as an additional benefit for long-term employees. It is also a perk that may motivate your team to stay for years and years to come.
Helping employees secure a mortgage and buy a house benefits the company. Housing can be a cause of stress. Renters, specifically, have to worry about rent every month. Although they can afford their rent now, their rent may increase in a month or year. They may be forced to find another place to stay at some point. Buying a house, too, can be a very taxing experience.
An employee going through issues with housing may find themselves unable to be productive which will have a negative consequence for the company at large. The aid mentioned above can ease the mind of employees, allowing them to work harder and better.