For years, home ownership has been considered an important part of the “American Dream”; however, attitudes in recent years have shifted away from this concept. Main Street reports that 82% of people believe owning a home is an important part of wealth building, yet 18% claim they are unwilling to accept the risk involved with a mortgage. Current economic factors are playing a huge part in more people deciding to rent rather than to buy, thereby losing out on the benefits of owning property. Here are some of the most common fears people face, along with some practical ways to overcome them.

1.      Fearing that a mortgage is risky 

Before the housing bubble burst, a mortgage was considered a type of investment, as property values almost always rose over time. The crash caused people to think about the possibility that housing prices could actually drop, which means that many consumers now see a mortgage as being risky.  Investopedia recommends lowering the risk by choosing a home in a low-crime neighborhood that contains primarily owner-occupied housing. They should also check with the zoning board concerning future development to determine whether or not construction could affect home prices. That way, even if the market does fluctuate, buyers can avoid a major decrease in property values.

2.      Being overwhelmed by maintenance costs

Many borrowers never consider the fact that they are responsible for home maintenance until something breaks.  Maintenance costs can really add up over time, which is why consumers should include the cost of maintenance in their budget when deciding how much money to spend on a home. There are also several other things buyers can do to keep maintenance costs from getting them down, including:

• Having a home inspection performed ahead of time to identify any major defects that would cost an arm and a leg later
• Purchasing a new home (or one that is fairly new)
• Learning to do basic home repair tasks  so a professional is not always needed
• Asking the seller for a home warranty to cover major repairs for a period of time after the closing

It’s also important to read over any homeowner’s association requirements carefully before making a purchase, as these agreements could specify certain maintenance be performed on a regular basis. Avoid neighborhoods with especially burdensome requirements, as keeping up with them could be a struggle, especially if the mortgage, taxes and insurance are also a bit on the high end.

3.      The fear of buyer’s remorse

Nearly everyone has suffered from buyer’s remorse at one point or another. Living with the regret that comes with making a bad decision is especially harrowing when it involves a home. For this reason, buyers should choose carefully, making sure to research each neighborhood thoroughly, and then making a list of things a new home must contain. Avoid buying on impulse, and make sure to carefully consider a home before making an offer to purchase. Most people who suffer from regret have allowed their emotions to persuade them rather than thinking about their decision practically. Taking the time to check each detail carefully will go a long way toward ensuring buyers are happy with their choice for some time to come.

4.      Concerns over mortgage scams 

This is a valid fear that should prompt people to do some research on how mortgages work. While researching mortgages, be sure to look at recent changes in the law in order to determine how buyers are now protected. New government rules on “qualified mortgages” are there to protect consumers from predatory lending practices, and are designed to ensure consumers don’t take out a higher mortgage than what they can afford. Make sure to use a reputable lender, and stick with a traditional fixed-rate mortgage whenever possible, as these tend to be less risky than adjustable rate or balloon mortgages are.

5.      Apprehensive over the credit check

Borrowers are sometimes apprehensive over having their credit pulled whenever it’s been some time since they last applied for credit. They may be unsure as to what‘s on their credit report, or have less than stellar credit and are nervous about having someone find out about it. The best thing to do is for people to obtain their own credit report and then check it carefully for errors. They should also talk with a credit counselor if need be to find out how to clean up a credit report so this fear can be eliminated altogether.

If you’re worried about any of the above items, you’re in good company. A significant number of new buyers also have the same concerns, yet these worries should not allow you to give up hope on becoming a homeowner. Owning real estate is one of the best things you can do to ensure your personal wealth, which is why overcoming the obstacles to home ownership is especially important.

Chad Dannecker is team leader of Dannecker & Associates. With more than 40 years of local real estate experience, Dannecker & Associates has established themselves as the leading source of real estate services in San Diego.