We’ve written a lot about the home buying process over the years, but why should you even consider buying a home? Many people today prefer renting or think that owning a home is out of their reach, but that doesn’t have to be the case.
It can be a big commitment when you buy a home, but it comes with so many benefits. We’ve highlighted four reasons why you should buy a home.
1. Tax Benefits
There are many tax benefits that come with home ownership. These breaks help offset some of your costs:
- The interest and mortgage insurance you pay on your mortgage is tax deductible.
- If you bought mortgage points, they’re tax deductible in the year that you bought them.
- Property taxes that are apart of your monthly payment are deductible.
- The money you make on the sale of your home (up to $250,000 or $500,000 if you’re married and filed jointly) is tax-free if you have owned the home for at least two years and put the money you make towards the purchase of a new house.
Homes generally appreciate in value over time, meaning that the longer you own your home the more valuable it becomes. While there are ups and downs in the housing market, owning a home is generally a smart investment.
When buying a home make sure you consider the area, the condition of the home, and how much land it has. Homes in good condition and in good areas hold their value and generally become more valuable over time.
Home equity is the difference between what you owe on your home and what the house is worth on the market. You can gain equity on your home in two ways:
- The longer you own your home (and pay down your mortgage) the more equity you have (assuming the value of your home doesn’t dramatically decrease over time).
- The more your home appreciates in value the more equity you have.
Equity takes time to build, but it is worth it. Investing in your home can have major returns down the road, and leaves you with something of greater value than when you started.
Depending on the market you live in, buying a home can lead to major savings when compared to renting. When you factor in the equity you’re generating, the tax breaks that come with home ownership, and the increase in the value of your property, a home is going to save you money in the long run and leave you with something of value that you won’t get if you rent.
The longer you’re planning on staying in an area, the smarter it is to buy a home. This calculator can help you calculate how long you’d have to live in your home before you start saving money compared to renting an apartment.
Let us Know How We Can Help
The home buying process can be both intimidating and overwhelming. Sometimes it can be hard to know where to start. But if you want the freedom, stability, and predictability of living in your own home – we can help you get started. Reach out today.