Homeowners' Advantage Over Renters
Home ownership may be a hard decision, it may be something that you do not think of as being advantageous. However, there are many positive aspects involved when you own your home. Below I have listed some of these aspects to help you factor in the pros of home ownership.
1. You Pay Less Taxes: Who doesn't like more money? In fact, who doesn't enjoy tax season when you get a large sum of money? Did you know that you can increase the amount of money that you receive on your tax return every year when you own a home? When you pay your mortgage every month, part of your payment is interest. At the end of the year, you'll be able to add up all of the mortgage interest that you paid for the entire year and deduct it from your taxable income, which means you'll get a larger return! If you are a home owner or if you have any more questions about this, I advise that you consult a tax professional regarding this.
2. Home Owners have an advantage no matter what the market does: Assuming that you don't lost your job, if you own your home you have an advantage. This is true even when the market drops. People freak out when the market drops and they own a home but they fail to realize that when the market drops, it always comes back! This is something that homeowners shouldn't worry about, simply because of the nature of the market. If it were to take a dip or drop, you can expect it to return. Home values will continue to increase, especially in areas with an at least stable economy.
3. Payments stay the same: The fear that a number of renters have is whether or not their landlord will increase their rent or keep it the same. This is a concern for many renters, especially when they have been in a place for a year or more. When you purchase a home, you know that the monthly payments are going to remain the same. The only difference will be property taxes, but from year to year the property tax increases affect homeowners minimally. If you enjoy stability, then owning a home is probably best for you!
4. Equity: Equity is like magic and it's something that only those who own property can use. You can obtain loans to invest, or for personal use, when the equity that you have in your home increases by a significant amount. Another way to capitalize on equity is to sell your home! When you sell your home for a price close to what the new value of your home is, you can walk away without potentially owing any taxes on the amount of money that you made in profit from the sale of your own home! Keep this in mind as you ponder the idea of owning versus renting a home!
5. Maintenance: Obviously when you own a home you are responsible for the maintenance of your property. There are a number of ways to mitigate large maintenance risks during your time as a home owner. The first way is to obtain an inspection when purchasing the home so that you can identify any issues in the home. An inspection will afford you the opportunity to negotiate repairs with the seller so that the home that you purchase is not a home that will cause you too many headaches, especially in the beginning! Also, using the inspection to keep up with the issues identified while living in the house will keep your costs down, maintain the good condition of your home, and it will allow your home to sell for a higher price when you decide that it is a good time to purchase!