Value

Own vs Rent

Are you confused or worried about owning your own home. Do you worry that you cannot afford to own a home? Your question should be "Can I afford not to own a home?". You may already be a homeowner just thinking about a change. Either way, I was surprised about these numbers. Let's look at some figures to help you determine how affordable owning your own home can really be.

What are the Advantages of Home Ownership

If you've been renting for awhile you have enjoyed the the freedom to move without the worry of selling a home first. You don't make repairs or pay property taxes. Eventually you realize you are missing a sense of security.  You begin to realize that your monthly rent payments are going into a bottomless pit. It feels like it is time to take a step in the direction of home ownership, but you are hesitant to take that big step.  If only you knew the advantages to owning a home.

Tax Advantages of Home Ownership
Tax incentives offered by the United States government make it possible for many homeowners to exceed the standard yearly deduction. Your state may offer the same benefits.

• A tax deduction for the yearly interest on your primary and vacation home. This amount equals a big chunk of your total payments for the first several years.
• You can deduct the total amount of your yearly property tax bill.
• If you refinance to consolidate other debts, the interest on the home equity loan is tax deductible.

Homeowners Have More Stable Costs of Living

• Monthly payments can change if property taxes and insurance go up, but increases usually happen gradually.
• Rental fees can sometimes be unpredictable.

Appreciation of Your Investment
Over time most real estate increases in value. With careful home selection and normal up-keep your home will be worth considerably more in five years than it was the day you bought it.

Your initial investment may be as little as 3% (or less) of the home's sales price, but you are the one who benefits from appreciation of the property. Not the bank, not the landlord. You.

Your Equity Grows Each Month
Even though interest makes up a good portion of your monthly payment, especially during the first years, the amount paid toward the principal increases each month. Appreciation and equity work together, helping you use your initial investment to "buy up" move into a home with more features if that's what you wish to do.

You Are In Control
The house is yours to do with as you please. You are the only one with the power to allow anyone to enter the house to inspect it. You can paint it and decorate it in any way you wish, put nails in the walls to hang pictures and artwork, bring home a pet without asking anyone if its allowed. The home belongs to you.

Wealth Effect

The wealth created by the value of home ownership for the typical American household was illustrated by a recent survey showing that three out of four homeowners indicated that their home represents a large portion of their wealth.  When making important financial decisions, many homeowners consider the value of their homes.

Home equity provides Americans with both financial resources and security. Homeowners can use their home equity to get cash for emergencies and to purchase big-ticket items. The capital gains people realize from the sale of their home are a significant source for down payment funds for most repeat buyers, but are used for other purposes as well.

Just over half of home owners tap their unrealized wealth through the use of home equity loans or a second mortgage, and 22 percent of these home owners pulled cash out of their home when they refinanced their mortgage. With the increasing volatility in the stock market, this emphasizes the importance of  home ownership as the primary nest egg for most Americans.

Visit us to find out how you can afford your own home. Home ownership is the greatest investment you can make for your family and your retirement. As you know we are open 6 days a week for your convenience and have many homes available to view. Stop by or call me to schedule an appointment.

Happy house-hunting!

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