The issues Military families face with providing housing for their families are many. With every tour there is the question of whether to purchase a house or apartment, or to rent these accommodations. With the average tour being 18-36 months; is purchasing a good option?
If one purchased a home in Norfolk Virginia during the housing boom prior to 2008 when housing prices were soaring; would it be underwater today now that the housing bubble burst and home prices and property values have tanked? Some housing values continue to fall and military families can expect to sell their home for less than what’s owed on it. Like thousands of service members many are looking to move across country this year per military’s order.
It’s frustrating. Depressed property values and the over abundance of houses on the market is a national crisis for home owners who purchase their houses before the collapse of the housing market. But for military personnel who must comply with relocation orders, waiting out the housing crash is not an option.
Service members begin every assignment knowing relocation is a possibility at any time. The Department of Defense encourages military employees to rent, not buy. However, buying a home is common practice because home ownership is a way to provide families with a feeling of permanency, a place to call your own and host holiday parties.
Conventional wisdom is to purchase with the intent of turning a profit, keeping the homes for retirement or renting them out as an investment. If you only rent, you may be behind the curve in terms of your financial future.
I’ve heard from service members from across the country who are under water on their home purchases and don’t know what to do. The amount of money they could lose on their homes is not something most people can afford.
Renting has it’s issues too when it comes to the numerous unexpected relocations that occur over a military career. The next home you rent definitely will not be the same size or have the same configuration. The living room could be much smaller and not accommodate the oversize couch that fit perfectly in the previous house. People often end up purchasing new items for each new residence.
Unpacking and setting up new residences is a huge part of the moving process. We all know the problems of trying to time the arrival of a family with the arrival their furniture. On more than one occasion we’ve lived on blankets without dishes and personal items. The biggest problem with renting a new residence in an unfamiliar location is you can never gather enough facts before hand to make a wise decision. Invariable, I’ve found that after we’ve lived in a new location for a while, we learn of more preferable places to live in the surrounding area, where the better schools are, where the best places to shop are, or what neighborhoods have better services.
At that point we’re forced to live out the remainder of our lease before we can consider moving again. Not to mention the full cost of a second move has to be absorbed by us. So, what’s the solution? If I had to do this all over again, I would strongly consider simply renting a short-term furnished house or furnished apartment. I would then have a chance to learn the new city and environment before making any kind of permanent decision. If I decided I wanted to be in a different neighborhood for better schools for my children, I could simply move in a couple of weeks without doing any packing of boxes or paying the cost of a full move. There would be no large investment in furniture. The facts associated with the ups and downs of the real estate market would be non-existent.
Everything I needed in a furnished apartment would be provided. The kitchen would be fully stocked with glassware, place settings, coffee maker, and microwave. The bedrooms would have all the necessities like beds, dressers, night stands, lamps, pillows, linens, towels. All the utilities would be included, electric, gas, and water. Of course I have the option of supplying things of my own and items that suit my taste.
According to my calculations I believe overall I could even save money by renting a furnished off base apartment. There would certainly be a lot less work involved in relocating to a new city. Since the Department Of Defense recommends renting as opposed to purchasing a residence. Why have they not commissioned a study to compare the pros and cons of renting verse buying verse leasing a furnished residence. I’ve tried to do the numbers for myself and I fully believe furnished houses and furnished apartments make a lot of financial sense.