Thinking About Purchasing A Home?

 

While home buying isn’t always the right decision for everyone, I’ve put together a list of 10 reasons why I think it’s worth considering either today or in the future.

1. House prices tend to rise over time, so a house is one of the best investments you can make.

Home prices in the U.S. have risen on average 3-6% a year for the past 20 years. That trend is likely to continue, so if you buy a home now, you’ve put your capital in a safe investment where it is likely to grow.

2. You’ll pay less tax.

You can deduct the interest you pay on your mortgage from your taxable income at the end of the year. The amount of tax break will depend on factors like your personal tax bracket, the size of your mortgage, the rate of interest you pay on it, and how long you’ve had the mortgage. As a general rule, the newer the mortgage, the greater the amount of interest you pay each month and the bigger the tax break. Recent borrowers with young mortgages tend to benefit the most.

3. You’ll be buying a piece of real property rather than paying your land lords house payment.

The real cost of renting is higher than the monthly payment. There is also an opportunity cost equal to the amount you would gain by using the money you pay monthly to purchase a home instead. Even if the house you purchased did not appreciate in price, you would be able to sell it and recoup some of the money you put into it just in the tax savings alone.

4. Interest rates are still historically low.

This makes it relatively inexpensive to take out a mortgage. The lower the interest rate, the less you actually pay for your house and the sooner you can pay the mortgage off. Our loan calculator below can show you how different interest rates affect the total cost of your mortgage and the time it takes to retire it.

5. You’ll be able to use the equity in your home for low-cost loans for other purposes.

You can access the paid-up equity you accumulate in your home in the form of a home equity loan or a home equity line of credit. Because they are secured by your house, home equity loans and lines of credit generally carry a lower interest rate than other types of consumer loans, such as auto loans. The interest on them is also generally tax-deductible.

6. You’ll have the stability and emotional security of owning your own home.

No more worrying about dictatorial or negligent landlords, rent increases, or the possibility your building will be sold from underneath you. You’ll be able to live in your house as long as you like, fix your monthly payments for as long as 30 years, and you’ll be the one in charge.

7. You’ll be able to redecorate and renovate any way you like, any time you like.

Rules about the paint colors you can use will be a thing of the past. And you’ll be able to tear out walls, install a powder room, and make any other improvements you want.

8. You get a home to call your own instead of paying rent on someone else’s mortgage.

You can have a piece of land that you can actually call your own.

9. You’ll be able to be a part of a neighborhood and a community.

When you’re a homeowner, you’ll get to know and establish lasting relationships with your neighbors. You can participate in yard sales, meet potential baby-sitters, and play Saturday-morning touch football in the park every fall.

10. You’ll have a greater voice in community affairs.

Local homeowners generally have more clout – individually and through ratepayer’s associations – when it comes to development proposals, school issues, and changes to traffic control and routing. Because renters tend to be more transient than homeowners, they have less influence on policymakers.