Buying a home is the largest single investment most people ever make, and this also makes it one of the most important decisions they will face. We have listed ten reasons why we think it is important for everyone to own a home.
- Freedom and Privacy. When you own your own home, you are not subject to the occasional inspections of the premises by the landlord. You can paint, decorate, or improve the property as you like.
- Inflation Protection. Your rent can keep going up, as do house prices. Once you purchase a home, you, not the landlord, reap the benefits of its appreciation in value. Historically, home prices will maintain value even in recessionary times, and increase in normal or good economies.
- Tax Benefits. Many interest deductions have been eliminated from the IRS regulations, yet mortgage interest on your home is a very healthy deduction, especially in the first years when the bulk of your payment is interest. Other deductions are also available to homeowners for energy credits or other improvements. Property taxes are also deductible.
- Improvement. Speaking of improvement, a renter gains nothing when he improves the house he lives in. A homeowner reaps a return on those improvements when the house is sold.
- Retirement Security. Unlike rent, which goes on forever, a mortgage is paid off at some point in time. This can provide a “rent-free” retirement dwelling for you.
- Environment and Lifestyle. It is usually apparent whether a neighborhood is made up of owners or renters. Homeowners have a financial stake in their neighborhood, and consequently take better care of their property. This, in turn, helps your property continue to increase in value.
- “Trading Up.” In today’s real estate market place, not everyone can afford their ideal home as their first purchase. By purchasing any home and gaining by its appreciation and any improvement made, many people are able to sell their first house and “trade up” to that ideal home of their dreams.
- Investment or Income Property. A second home can be an excellent tax deduction and investment. Interest on a second home is also tax deductible, and you will be able to gain profits and tax benefits from renters.
- “Effective” Interest Rate. The interest you actually pay will be much less that you think, on the fit impression. Because the interest in tax-deductible, you may be able to change your withholding or receive a larger tax refund.