This is one of the most shadowed myths surrounding home ownership, the one where the belief is that you can own your own home and own it outright. The truth is rather different, though the chances of losing your home are slimmer.
A lot of Americans falsely believe they can own their home without a mortgage and there is no way to lose their home’s equity. This myth is fueled throughout the nation, with many believing their home is a safe investment. That belief is only “mostly” true as you can never truly own your home outright.
Part of the reason you can never truly “own” your home is that the government can take your home, basically whenever they want. That power was given to them through imminent domain laws. Typically, the government pays you off to take your home, but that may be below market value, creating loss of home equity, not to mention the fact you have to find another place to live.
Unfortunately, many residents in Galveston’s beach front property are facing a totally different way they could lose their property. Those residents may not get even a single dime for that property and there is no insurance that will cover how they may lose that property.
You see, the laws in Galveston on beachfront land is that a certain distance from the waterline is automatically public property and therefore cannot be owned by homeowners. Hurricane Ike eroded so much beach that the the distance from the waterline that is “public” property now overtakes private property. In many cases, homeowners will not be allowed to rebuild.
Still think you can own your home outright and that home equity is a safe investment?