Often times renters and potential buyers ask me what are the benefits of home ownership. The reason most ask this is because they're scared to purchase as they have been leaning on their landlords for years for things like repairs and such, but there's way more to home ownership than that.
So here are 5 benefits of home ownership.
1. Build Equity
Equity by definition refers to the amount of value you have in an asset. Home equity is the amount of your mortgage that you've paid off. As you pay off your mortgage every month, you're building equity in your home. You can also make additional payments towards your mortgage principal payments to build equity faster.
You can pull equity out your home to pay for home renovations or consolidate debt, etc.
2. Control Over Expenses
When you own a home, you will know for certain the amount of your monthly mortgage payment. For the most part, your monthly mortgage will remain the same give or take a little fluctuating due to increase in annual property taxes and mortgage insurance if they're included in your mortgage payment, usually on FHA loans.
On the other hand, when you're renting you're faced with rental increases annually if your landlord decides to change it. When you first move to a rental property, you're required to make at least 3-3.5 times the rent, but if it increases, will your income still be at this expectation? You will never know.
3. Strong Credit History
Buying a home can help strengthen your credit over time as long as you consistently make your monthly payments on time. As you build your credit, it will open up other opportunities for securing financing for other lines of credit such as buying a new car, getting credit cards with great interest rates, or financing an investment property.
4. Property Improvements
One of the biggest benefits is the freedom to make home improvements on your property such as painting or renovations to make the house exactly how you want. When you're in a rental, if you decide to make any changes you have to return them to the original condition the place was upon you moving in. If you own your own home, you can paint, do upgrades, add fence, paint the exterior, etc. Anything you want to do to your home, as long as you don't have an HOA who has restrictions for certain property improvements, you have the freedom to customize your home to fit you and your personality.
5. Property Tax Deduction
Owning a home definitely has tax benefits. On a federal level, you can deduct a the interest portion of your mortgage payments. You will receive a mortgage letter at the end of each year from your lender detailing the interest you've paid. This deduction is capped at $750,000. There are also many state and local deductions for sales and income tax as well (check with your state for specific deductions).
These are just a few benefits of home ownership. If you' re ready to get started, don't hesitate to contact me for a buyer consultation. If you're in the market to sell your home, I love working with sellers as well. Book your seller consultation here.
Happy house hunting.
Be sure to follow us on all platforms for daily tips and videos of new homes in the Atlanta area.
Follow us:
Comments