The Minneapolis Area Association of Realtors, in the consumer section on their website, has a list of seven reasons to own your own home as opposed to rent. First time home buyers
don’t always have all of the information available to them as to why owning a home can be so much better than renting a home. If you’re considering ditching the landlord and buying a home
for the very first time, here are some things to consider.
1. Tax breaks
. According to the U.S. Tax Code you can deduct the interest you pay on your mortgage, property taxes, and some of the costs involved in buying your home. This one is so self-explanatory, it is hard to expand on!
. Real estate has long-term, stable growth in value. While year-to-year fluctuations are normal, median existing-home sale prices have increased on average 6.5 percent each year from 1972 through 2005, and increased 88.5 percent over the last 10 years, according to the National Association of Realtors®. Additionally, the number of U.S. households is expected to rise by 15 percent over the next decade, which will continue the high demand for housing.
. If you’re paying rent, you might as well be throwing money out of the window. You’ll never see again, and when you move out, you will have nothing to show for it. Mortgage payments allow you to build equity ownership interest in your home with every payment you make. When owning a house it is possible to gain equity value in several different ways, including housing supply and demand, new commercial developments nearby, new schools in the area, and new highway access, just to name a few.
. Continuing on along the equity line of though, your home can be like a large-scale piggy bank. Building equity in your home is like building interest in a bank account but only at a more rapid pace. You add money to it with every mortgage payment you make, minus interest and fees of course. When you sell, you can generally take up to $250,000 if you are single or $500,000 for a married couple as gain without owing federal income tax. In addition when you sell your home, you can take a tax deduction of $250,000 or $500,000 for a married couple as long as you have owned your house for 2 years.
. Unless you’re stuck in an adjustable rate mortgage, your mortgage payments don’t go up over the years, unlike rent. How much? Only your landlord knows. You don’t need that kind of worry. The longer you are making payments on your home, your housing costs may actually decline. Do keep in mind, however, that property taxes and insurance costs will rise. As mentioned earlier you can also write off the interest on your mortgage, though.
. Renting a home usually limits the amount of decorating that you are able to do. When you own your own home, you can decorate any way you want and benefit from the investments you make in the home. What is more, if you need more space, you can add on to the home! Home ownership also offers advantages which make life more enjoyable, such as backyard barbecues, family gatherings during holidays, a home office or workshop, and all of this and more can be done in the privacy of your own home.
. Remaining in one neighborhood for several years gives you a chance to throw down roots. You can establish long-lasting friendships you’re your neighbors and participate in community activities. Additionally, children can benefit from growing up in the neighborhood of your choice at schools you decide on.
Why would you pay someone else rent when you can put that same money towards a home of your own and reap all of these benefits?
If you would like to learn more about purchasing a home in the Minneapolis market, a Minneapolis home buying seminar is a great place to start. There are upcoming home buying seminars in the Minneapolis Metro Area. Register
to attend a Barker & Hedges home buying seminar for free.