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Tom Hanks and the Real Estate Home Ownership Debacle (6 Things to Consider to Succeed)

I truly hope you have had the pleasure of watching the 1986 film, The Money Pit with Tom Hanks. I was a young kid at the time, but I still remember my parents thinking it was hilarious. And it perfectly captures the trials and tribulations of real estate home ownership and investment.

Home Ownership, Is it Worth It? What does Tom Hanks Think?

Don’t get me wrong, I still believe over the long term, home ownership is the way to go. I am professionally a “real estate dude”, so I have experienced all this in the real world. BUT, people should go into real estate and home ownership with eyes wide open to the many challenges that can result.

Tom Hanks

A Unique Time for Tom Hanks

We are in a particularly unique and challenging time for home ownership. Home values shot up to the moon during the pandemic years. Interest rates on mortgages have been rising aggressively for the last year, which is clearly having a cooling effect on demand and home prices. Prices appear to have dropped across the board from peaks, but things are not necessarily a bargain.

But even though prices have cooled and dropped, they are still historically rather high. And this is for one simple reason: supply and demand. There is just not enough housing available. And many investors have gobbled up single family units in order to create steady and tangible income streams in a volatile world.

An Abundance Agenda

This is a big reason in our INFLATION DEFENSE SYSTEMS we have called for a national abundance agenda. A time of aggressively building and supplying what is needed. More housing, more schools/teachers, more healthcare, etc.! That is the real inflation destroying the middle class, not the price of TV’s.

In this article I am going to present 3 challenges to home ownership and 3 advantages. Again, I mainly side with supporting home ownership for people that have prepared themselves and are ready for the responsibilities.

The Money Pit Starring Tom Hanks (3 challenges to home ownership)

  • Financial Responsibility: One of the biggest challenges of home ownership is the financial responsibility that comes with it. Owning a home requires a significant financial commitment, including mortgage payments, property taxes, maintenance costs, and repairs. Homeowners must be prepared to manage their finances carefully, including creating a budget and saving for unexpected expenses.
  • Maintenance and Repairs: Maintaining a home can be a time-consuming and costly process. Homeowners must be prepared to perform regular maintenance tasks such as cleaning gutters, painting, and maintaining HVAC systems, as well as making repairs when necessary. These tasks can be challenging for those who lack the necessary skills or resources to complete them.
  • Unexpected Emergencies: Homeowners must also be prepared for unexpected emergencies such as natural disasters, structural damage, or plumbing issues. These emergencies can be expensive to repair, and homeowners may be responsible for covering the costs themselves if they do not have adequate insurance coverage. Homeowners must have a plan in place to handle emergencies and be financially prepared to deal with the unexpected.

3 Advantages of Home Ownership, based on watching the Money Pit with Tom Hanks.

  • Investment: Homeownership can be a valuable long-term investment. Over time, the value of a home typically appreciates, meaning that homeowners may be able to sell their property for more than they paid for it. This can provide homeowners with a source of wealth and financial security.
  • Control and Personalization: Homeownership provides homeowners with control and personalization over their living space. Homeowners have the freedom to make changes and upgrades to their home that reflect their personal taste and preferences. They can also customize their home to meet their unique needs, such as creating a home office or adding an outdoor living space.
  • Stability: Homeownership can provide a sense of stability and belonging. Homeowners can establish roots in a community, build relationships with neighbors, and create a sense of belonging. Homeownership also provides stability in terms of housing costs, as mortgage payments remain relatively stable over time, unlike rental costs which can fluctuate from year to year.

Massive Wealth

Let’s face it, massive amounts of wealth have been created and destroyed through real estate. Tom Hanks would know. Therefore, it needs to be considered in a very careful and rational way. I still believe in the power of wealth building through real estate, but this needs to be analyzed in a multi dimensional way in order to succeed.

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