Are there advantages to owning a home? One way to answer this question is to look at the benefits to owning a home. These benefits may or may not apply to you depending on whether you are a first time home buyer, buying a move up home or downsizing, or you are buying a second home or investment property. If you are thinking about purchasing a home and asking about the advantages of homeownership, then you should consider the following three benefits.
1) Tax or Financial Benefits: When you step into home ownership – not only with your first or second home there are plenty of financial benefits that stem from federal, state and local tax laws that you don’t get to take advantage of when you rent where you live. Off the top are things like real estate property taxes and mortgage interest – both of these are tax deductible. You can in many cases get a much better living situation with a lower monthly payment if you happen to buy a home when interest rates are low and if you buy within your budget – and you consider the tax write offs.
2) Personal freedom, satisfaction, and pride: One of the greatest benefits of home ownership is the idea that it is your house to do with what you want. Well, that may be within reason if you live in a neighborhood with a home owners association. But for the most part, if you want to redo a bathroom or paint your kitchen you have the freedom to experiment. You also have the knowledge that you own something that you have worked for that for as long as you make the mortgage payments and real estate tax payments no one can take it from you, or evict your, or raise your rent on.
3) Wealth Building: We know this is hard to believe given the recent financial/mortgage/housing market crashes of 2007-2009, but over time one of the only long term wealth building has at its heart – owning real estate. People who own real estate typically have a much higher personal net worth than those folks who don’t own real estate. And with real estate, values do go up over time even though there are cycles in values when you consider the short term.
As you can see, there are advantages to owning a home. Next up would be to think about the disadvantages of owning a home. There are some.