Families purchase homes for a variety of reasons. They could need a bigger space, build wealth, want to paint their walls and customize a home, or take control of their monthly expenses. Below are 6 benefits of owning a home.
Homeowners can deduct the interest on their mortgage expenses from income taxes. This needs to be done using an itemized deduction and is for up to $750,000 worth of mortgage debt.
The other way that it saves you during tax time is on capital gains tax. When your home appreciates in value, you are not taxed on the gains at the federal level. Your home can appreciate up to $250,000 more in value from when you bought it without being taxed on the growth of your investment.
Owning your home gives you the flexibility and freedom that renting will never provide. Whether you are looking to renovate your kitchen, paint your walls, or switch from carpet to hardwood floors, owning your home gives you that opportunity to make these choices.
Pride Of Ownership
There is something special about the feeling you get when you own your home because purchasing a home is not easy. You have to find the right property, negotiate a deal the seller will actually accept, get approved for a loan, and provide what seems like a large novel of documents all within a couple of months. When you get to the finish line, you get a sense of pride knowing you did what it takes to own your home.
When you rent, your monthly payment goes directly into the pocket of your landlord. However, when you own your home, that monthly payment acts as both a savings account and an investment. As the years go on, the demand for housing will increase, as will the value of your home.
While the mortgage will be for the same total amount, your home (and initial investment) will increase in value. This means just by paying your mortgage every month, you can begin to build a wealth that you can pass on to generations below you.
Owning a home provides you with a permanent place where your family can grow and build memories. As a renter, you are typically limited to a yearly lease. At the end of that lease, your landlord has the ability to raise your rent or choose not to renew. This makes it difficult to establish roots in your community and as a result, you may end up moving frequently.
When you own your home, you control your monthly payment. While things like taxes may increase, your principal (which makes up the biggest portion of your payment) will stay the same for the entirety of your mortgage. This provides you with a stable monthly expense that does not rise with the market.
However, when you rent, your landlord will usually increase your monthly payment each year to match the rise of the market. Over the span of a 30-year mortgage, the difference in payments can become monumental.
If you are looking to kick your landlord to the curb and own your home, click here today. You can schedule a free consultation with one of our loan officers and develop a plan to turn you into a homeowner.