What are all of the financial benefits of owning a home?

Asked by Trulia Atlanta, Atlanta, GA Mon Feb 18, 2013

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Fred Yancy, Agent, Woodstock, GA
Mon Feb 18, 2013
Reasons to Own Your Home

Tax breaks. The U.S. Tax Code lets you deduct the interest you pay on your mortgage, your property taxes, as well as some of the costs involved in buying your home.

Appreciation. 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. In addition, the number of U.S. households is expected to rise 15 percent over the next decade, creating continued high demand for housing.

Equity. Money paid for rent is money that you’ll never see again, but mortgage payments let you build equity ownership interest in your home.

Savings. Building equity in your home is a ready-made savings plan. And when you sell, you can generally take up to $250,000 ($500,000 for a married couple) as gain without owing any federal income tax.

Predictability. Unlike rent, your fixed-mortgage payments don’t rise over the years so your housing costs may actually decline as you own the home longer. However, keep in mind that property taxes and insurance costs will increase.

Freedom. The home is yours. You can decorate any way you want and benefit from your investment for as long as you own the home.

Stability. Remaining in one neighborhood for several years gives you a chance to participate in community activities, lets you and your family establish lasting friendships, and offers your children the benefit of educational continuity.

Fred Yancy, Broker
Crye-Leike Realtors
(678) 799-4663
4 votes
Jim Simms, Mortgage Broker Or Lender, Louisville, KY
Wed Feb 20, 2013
Actually, none of the previous answers apply to everyone. Home ownership is a highly personal undertaking. What is good for one person is terrible for another. When it comes to buying a home one size does not fit all. For example, everyone gets a standard tax deduction even people that do not own a home, only your tax advisor can figure out if you even get a deduction above that.

As for a calling a hard dollar expense that maybe is deductible a write off, it is first an expense, before it is a write off. I do not consider something you pay for a tax break. There are other assumptions that impact this, what if all of the buyer’s income is non-taxable? Just got off the phone with such an individual, how important is it to them? None of the financial math involved in home ownership will impact two individuals exactly the same.

My comments are not intended to dissuade anyone from buying a home, quite the opposite; I earn a living financing these puppies. Just see it for what it is. If you are looking for an excuse to buy a home do it just because you want to, not because someone tells you it is what you should do. I could stack up an example of renting a smaller place, investing the difference and compounding interest, just the opposite of ownership, it too would be a pretty picture.

Buy a home because you want to enjoy living there, don’t look for an excuse other than that. I have seen many people stretch what they could afford because they thought it was a sure bet, there is no such thing.

Jim Simms
NMLS # 6395
Financing Kentucky One Home at a Time
Web Reference:  http://jamessimms.com/
0 votes
William Pola…, Mortgage Broker Or Lender, Suwanee, GA
Wed Feb 20, 2013
Thumbs up to Fred on his answer.
0 votes
CIndy Sun, Agent, Las Vegas, NV
Mon Feb 18, 2013
I assume you're asking about the benefit of owning versus renting.

One of the biggest benefit is equity. A good chunk of the mortgage payment goes toward the home - meaning that the money paid can be cashed out when the home is sold. Whereas renting, the rent is for the landlord to keep.

Cindy Sun
Keller Williams Realty Southwest
Cell: 702-825-2555
Web Reference:  http://www.cindysun.com
0 votes
Isabel Elses…, Agent, Alpharetta, GA
Mon Feb 18, 2013
Okay we have property tax deduction.
We have mortgage interest deduction.
Build equity! Better return than your checking account.

Isabel Elsesser, Realtor
First United Realty
Save Time & Money!
Direct 770-307-8751
Fax 888-799-3184
Full Time from 1993-2013

selling in Gwinnett, Milton, Johns Creek, Alpharetta, GA
0 votes
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