Call me selfish, but I can think of several reasons why rising home prices do not benefit me as a homeowner settled in my nest. Even though I am living in what was meant to be a starter home, I am now comfortable calling it my forever home. I'm worried if home values continue to recover; some of the longtime homeowners in my community may sell and move out. According to a recent article by AOL Real Estate, some real estate experts believe the price rise is unsustainable. Even though a report by the National Association of Realtors indicates home prices are up 15 percent compared to a year ago, the double digit leaps can't be sustained. That's because prospective homebuyers don't have the income to be able to afford more expensive homes. I'm hoping home prices simply stabilize so we don't enter another housing bubble.
Property taxes will go up
I'm putting money aside for a leap in my property taxes. Because my property taxes and insurance are included in my mortgage payment, I psychologically prepare for higher taxes by paying extra on my mortgage every month. I continue to pay a mortgage based on the higher taxes I've paid in the past. In 2006, I owed $3,764 a year in property taxes. Even though we only owe about $1,600 a year, I pretend we still owe twice as much so it won't be as difficult to make the adjustment when property taxes go back up. I also put $100 a month aside in my emergency fund to pay for expected property tax hikes.
I'll miss my good neighbors
I am making an effort to attend more of the Homeowner Association meetings in order to get to know my neighbors better. Many of the original homeowners have kept up their houses and yards so they can sell when the housing market recovers. However, most of the neighbors I know in my Florida subdivision tell me they are still underwater on their mortgages, owing more than the homes are worth. If home prices stabilize instead of making giant gains, some of them will remain instead of selling their houses to investors.
My neighborhood will get old
I also think it's advantageous for a community to have some first-time homebuyers, especially as the subdivision gets older. If home prices become too high, it will keep out first-time and younger homebuyers. I would like to see people in my sons' generation be able to afford to purchase homes instead of having to rent. Also, many of the homebuyers who got short sale or foreclosure deals during the housing "bottom" had enough money add attractive landscaping and improve the curb appeal. If houses become too expensive, no one will have the discretionary money to make home improvements.
If home prices could stop acting like the crazy volatile stock market, I think more people would be able to simply relax in their homes. They wouldn't be tempted to become move-up homebuyers, downsize or get a reverse mortgage. I shouldn't care what other people do, but the upward tick in home prices will directly impact me as a homeowner who wants to love it, not list it.
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More from this contributor:We are No Longer Underwater on our Mortgage
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