Homeownership entails a lot of responsibility, but
also comes with a lot of rewards. We have provided you with some points of
consideration that would aid you in deciding whether home ownership is the
right thing for you, and shall give you a weight to compare with the
alternative of renting.
1. It’s
an Investment
You
should consider buying a house as an investment. Even though home prices may
have a cyclic rotation, if you live in one, over time it gains a relatively
phenomenal boost in its true value-thus providing you with a substantial
return- negating all depreciation effects. There are many online applications
that lets you input costs and expenses to calculate which option provides you
with the most economic benefit, over the period that you indent to reside in
that home. For a more accurate comparison, you should account for increase in
rent over time.
2. Building
Equity
Home
equity is the monetary value of the home that actually belongs to you. It is
calculated by subtracting from the total value of the house, the amount you
owe. There are two ways you can build equity:
i.
By paying the mortgage you are reducing
the amount that you owe from the total loan, this reduction in the loan
contributes towards an increase in your equity. In other words, you can call
the payments towards a mortgage a form of savings as it increases your home
equity.
ii.
An increase in the monetary value of
your home also boosts its equity.
You can tap an increase
in equity in the future as a source of money. If ever in a crisis, you can
always opt for borrowing against your home equity, this provides an essence of
liquidity to the home which is now also an asset.
3. Tax
Deductions
Homeownership
reduces the amount you must pay in income taxes each year. The payment of your
property tax and mortgage interest is deductible from your federal taxes,
including many state taxes as well. Some loan discount points and closing costs
are also tax deductible. In the initial years of your mortgage, the interest
represents the bulk of your entire monthly mortgage payment; tax deduction from
this could give you back a significant portion of amount you paid.
4. Strong
Credit History
Buying
a home and consistent timely monthly payments of your mortgage portrays that
you are a good borrower and the risk of you defaulting on a loan is very low.
This strong credit history helps you with future loan acquisitions, like in the
case of buying a car, making home improvements or making payments of major
expenses.
Besides all the four mentioned points, being a
homeowner allows you absolute freedom to create a living environment that suits
you best. You can keep a pet, paint whichever color you like, change the floor
or the carpets and make all the changes to your hearts content without having to
take permission from a landlord. So check out Remax, Quality Service to get the
best deals for property for sale in pa.
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