While owning a home is a big step that requires high upfront costs, there are plenty of long-term advantages that aren’t always obvious. Aside from getting a place to call home, buyers also build equity, have predictable housing payments, and enjoy several other perks.
Having reservations is normal. The more you know about why you should buy a home, the less scary the entire process will be. It’s reasonable to double-check yourself, though. Here are six good reasons why you should consider buying a home.
Prices will continue to rise. Whether you are planning on relocating to a different area of the country or are planning to stay in your current city or state, waiting to move may end up costing you more than you think!
Keep in mind that the industry changes day today.
Mortgage rates are always changing. We know those big life decisions can be kind of scary and even unsettling. But even though there are several emotional factors included when purchasing a home, you have to remember the end result.
Waiting to purchase a home until you are emotionally ready, may not make the most financial sense in the long run.
Whether renting or purchasing. Someone is paying the mortgage.
Owning a home is still one of the greatest investments the average American can make. What is even more certain is, everyone needs a place to live. Investing in a home with a fixed interest rate provides stability one will not experience with a landlord.
Landlords write contracts with provisions and annual increases in them. Renting means one is subject to moving at the end of the lease term. One might assert that they are not subject to maintenance cost, but this is only partially true as most landlords and management companies factor maintenance into the rental rates they charge.
Owning is a form of forced savings.
Building equity in your home is a ready-made savings plan. And when you sell, you can generally take up to $250,000 ($500,000 for a married couple) as gain without owing any federal income tax.
There are substantial tax benefits to owning a home.
Homeownership is a superb tax shelter, and tax rates favor homeowners. Sometimes, the mortgage interest deduction can overshadow the desire for the pride of ownership as well. As long as your mortgage balance is smaller than the price of your home, mortgage interest is fully deductible on your tax return.1 For a large portion of the time you pay down your mortgage, interest is the largest component of your mortgage payment.
IRS Publication 530 contains tax information for first-time homebuyers. In general, you can deduct state and local real estate taxes. Most homeowners pay their property taxes as part of their monthly mortgage payments.
It’s time to have a place to call home!
Homeownership brings many responsibilities, and it’s wise to make sure you’re ready before you buy for the first time. But as you can see, it has a lot of benefits. Be sure to weigh the pros and cons when you’re considering buying your first home.