Why Home Ownership Is Good For You And Your Future
June 11, 2021
“Real estate cannot be lost or stolen, nor can it be carried away. Purchased with common sense, paid for in full, and managed with reasonable care, it is about the safest investment in the world.” Franklin D. Roosevelt
There’s a sense of pride that comes with owning a home. Apart from the proud feeling, there are many reasons that home ownership is great. In this post, we will go through 4 of those reasons. Let’s get started.
4 Reasons Why Buying a Home Is Good For Your Future
1) Better Financial Control
As a homeowner you are always in better control of your financial conditions compared to when you rent a home. There are two main reasons for this.
First, because your rent may change over time (in fact, it often does change), whereas your mortgage won’t (unless you change the terms of the mortgage). It’s easier to understand and predict how much you’ll have to pay monthly with mortgage.
Secondly, the cost of utilities is a big addition to your monthly expenses. As a tenant, you don’t have much say in the energy efficiency of the equipment being provided in your home. However, as a homeowner, you can choose more energy-efficient appliances and save hundreds of dollars every year.
Both of these things can make a big contribution to your future financial planning.
2) Build Equity
Renting a home is like paying monthly for something in which you don’t even have a stake. Compare this to owning a home, with every monthly payment you are making, you are owning a bit more of your home. That’s why many people like to call it a forced saving. You are making monthly investments in something where the value will only increase with time.
Also, it is a well-established fact that asset-wealth is a much more secure option than any other type of investment. If you are looking in the long run, house values will always increase, and bring you more equity than other types of investments.
If you carefully plan your mortgage repayment, you can build equity very quickly. For instance, paying off the debt quicker by increasing your monthly payment amount.
3) Tax Benefits
Owning a home also brings with it a number of tax benefits. For instance, you get a deduction for the interest rate and tax portion of your mortgage. According to the Tax Cuts and Jobs Act passed in 2017, mortgage interest deductions are set up to a limit of $7, 50,000, which used to be $1,000,000 previously.
Apart from these tax benefits, you also get the option of taking out a home equity line of credit once you have built sufficient equity in the home. This line of credit is tax-deductible, which makes it a double benefit.
Lastly, you also have the option to write off the mortgage points on your loan the first year you buy your home. This can be a big saving based on the number of points you claim.
4) Other benefits
Apart from the three benefits mentioned above, there are several other benefits associated with owning a home.
The first one is an increase in credit score. A home loan is considered a good debt, so if you make your payments regularly, then chances are it will help in increasing your credit score, which boosts your creditworthiness. This means that the likelihood of you getting a business loan or needing a line of credit in the future increases. It can even bring down your car insurance as well.
Now, these benefits might look too small to lure you into buying a home, but they can provide big savings in the long run.
As you can see, there are many benefits associated with becoming a homeowner. If you have good control over your financial health, then perhaps the best time to buy a home is right now. Not only will it lead to financial stability, but it will also prove to be a smart investment for your future as well.
If you are wondering where to begin your home search, then the answer lies right here – Negotiator Recognized Partner (NRP). An NRP is a real estate professional that ensures you get the best deal for your new home. They will even negotiate on your behalf.
So, what are you waiting for? Take the first step towards a brighter future by buying your first home. All the best!