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5 Benefits of buying your own home and having complete ownership of it

Posted by admin on December 30, 2018
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As they say, Home is where the heart is. It’s also where a big chunk of where your financial responsibility lies. Home ownership is a pillar of the biggest of our dreams from childhood to adolescence, and while many of those in younger generations either can’t afford to or actively choose not to pursue it, those who buy in to the housing market often see major financial benefits.

There is no doubt that changing into a home-owner is one of the most important monetary decisions you’ll build in your entire life. It’s conjointly undeniable that merely aiming to that time needs a particular degree of financial success. you would like to come back up with a down payment and closing prices (generally regarding 3 % to 4 % of the full home purchase price for buyers) before you’ll even flip the key within the door. however among people who tackle the massive task of home possession, several see monetary advantages that way outweigh their initial investment, particularly throughout tax season.

Thus, that is the reason we have coiled up 5 different reasons as to why having sole home ownership is extremely beneficial and is of utmost significance to home buyers and investors. The top 5 reasons are as follows:

1- Build a stronger and stable financial future:

The recent recession threw a wrench into the idea that home ownership always builds wealth over time. But the fact remains that owning a home is one of the fundamental means of accumulating wealth as we age. The caveat: you have to buy a house that you can actually afford.

5 Benefits of buying your own home and having complete ownership of it.

Asset-wealth is a much more secure predictor of future financial stability than income, which can—and often does, in today’s evolving economy—change from year to year. In a strong economy, home values generally increase by 3 percent to 4 percent every year, thanks to inflation and natural population growth. From 2011 to 2016, as the housing market has recovered from the bubble that contributed to the recession, home values have been increasing even higher at an average rate of 6.3 percent a year. Putting money into home ownership versus a rental is akin to the difference between putting money into an investment account versus a no-interest checking account, with the latter being only as valuable as it is in the moment while the former increases over time.

2- Tax Deduction on Home Ownerships:

You get a number of tax breaks for owning a home, most notably a deduction for the interest and property tax portion of your mortgage. This deduction is particularly useful for off-setting the initial financial blow that comes with purchasing your property, since in the first years of owning your home you’re mostly just paying off the interest on your mortgage, as opposed to the principal. The first year you buy your home you are also able to write off any mortgage points on your loan, which can lead to pretty considerable savings depending on how many points you claimed. And if you ever decide to refinance your home after building sufficient equity in it, you also have the option of taking out a home equity line of credit, which is itself tax deductible.

3- Mass Equity:

Every single month that you pay your mortgage you own just a bit more of your home. This is a big benefit over renting, where you’re paying comparable monthly fees without any comparable stakes. The equity in your home builds in two ways and often concurrently: (1) equity builds as the value of your home increases, and (2) equity builds as you pay off more of your loan. These two factors mean that after the first couple of years (when, again, you’re mostly just paying mortgage interest), every month you pay money toward your loan you are building up your financial resources for the future. It’s why some people refer to mortgage payments as “forced savings.”

Want to build equity even faster? Take steps to pay off your debt quicker (like financing with a shorter-term loan or paying more than you owe every month) or increase your property value (think home improvements and a focus on routine maintenance).

5 Benefits of buying your own home and having complete ownership of it.

4- More control over day-to-day housing-related costs:
Unless you change the terms of your mortgage, you know the base cost that you’re going to be spending to live in your home every month, both now and in the future. This affords more stability than rent, which is variable and can (and often does) change over time. And control over costs goes even further than that. As a renter, you don’t have a say over whether your landlord supplies you with energy-efficient appliances that can save you hundreds of dollars every year, but you do have to pay the utility bill either way. As a homeowner, you can make better short and long-term financial decisions that are geared specifically toward your own financial goals and abilities. While this isn’t likely going to help you save for your future in the same way building equity does, it should bring you peace of mind to know that you’re saving money everywhere that you can.

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