In todays volatile housing market most renters or past home owners are wondering if it’s a good time to buy a home. Well I have included 5 of the best reasons (not just appreciation) of why it’s always good to take advantage of home ownership, no matter what market you’re in.
Let’s start with the biggest:
#1 Pride of Ownership
Pride of ownership is the number one reason why people desire to purchase a home. The beauty of this is that YOU own the home which means that you can fix up the house if you desire. You can paint the home to the color of your choice, install hardwood flooring to get rid of the carpet, have friends and family come over and not have to worry about making to much noise, etc. I remember when I was renting for the first time, I enjoyed my surround sound entertainment system but the neighbors did not! It was a very good feeling owning my first home to know that I could turn the stereo up as loud as I wanted and nobody, except my wife, would care. Home ownership gives you and your family a sense of HOME which I believe gives you stability and security. You are truly making an investment to your future.
#2 Mortgage Interest Tax Deductions
Home ownership is a wonderful tax haven and our tax laws really favor homeowners. The government likes to encourage home ownership the best they can and one of those ways is to give you a break on your taxes every year. As long as your mortgage balance is smaller than the price of your home, mortgage interest is fully tax deductible on your tax return. The best part is that interest is the largest component of your mortgage payment.
#3 Great Homes on the Market
Right now because of the demand for sellers to get rid of there homes we have what’s called in the real estate industry a “buyers market”. What this means is that there are more homes for sale then there are buyers. The good news for you is that you can get a great deal on a home right now. Many of the homes we are seeing are being sold for lower than what the current appraisal value is at. This creates instant equity for you and your investment.
#4 Principal Reduction Will Increase Your Equity
Each month, part of your monthly mortgage payment is applied to the principal balance of your mortgage. Picture “amortization” as a moving scale, in the beginning years of your ownership you are paying more interest than principle. However the longer the loan stays in place the more the scale begins to tip in your favor. Soon your monthly payment will go more towards principle reduction than it will interest which will drive your balance down very quickly.
#5 Appreciation
I saved this one for last because even though it is a VERY strong reason to get into a home it still is a variable. Our Seattle market however is still the strongest in the nation with no signs of slowing down. It has been driven by our stellar economy and the fact that our homes are so closely grouped together. Think about it…you can’t build east (mountains) you can’t go west (ocean) and unless you want to have a ridiculous commute, you have to stay centralized. Right now in our market it’s safe to say that your appreciation will still be in the range of 5% – 10% per year depending on the area.
So there you go, those were only 5 of the MANY reasons why home ownership is one of the best investments in your future that you will ever make. I know that there are many more out there and I would like to hear from each of you to see if you could add a few to the list.
However I am going to throw a little incentive out there. So here we go:
For the best reason why home ownership is a good option I will personally send a $10 Starbucks Gift Card (or any favorite coffee shop) to you.
Just make sure that you include a phone number or email address in your comments. So I can get a hold of you.
Dedicated to your Success,
Kenton Becker
Let’s start with the biggest:
#1 Pride of Ownership
Pride of ownership is the number one reason why people desire to purchase a home. The beauty of this is that YOU own the home which means that you can fix up the house if you desire. You can paint the home to the color of your choice, install hardwood flooring to get rid of the carpet, have friends and family come over and not have to worry about making to much noise, etc. I remember when I was renting for the first time, I enjoyed my surround sound entertainment system but the neighbors did not! It was a very good feeling owning my first home to know that I could turn the stereo up as loud as I wanted and nobody, except my wife, would care. Home ownership gives you and your family a sense of HOME which I believe gives you stability and security. You are truly making an investment to your future.
#2 Mortgage Interest Tax Deductions
Home ownership is a wonderful tax haven and our tax laws really favor homeowners. The government likes to encourage home ownership the best they can and one of those ways is to give you a break on your taxes every year. As long as your mortgage balance is smaller than the price of your home, mortgage interest is fully tax deductible on your tax return. The best part is that interest is the largest component of your mortgage payment.
#3 Great Homes on the Market
Right now because of the demand for sellers to get rid of there homes we have what’s called in the real estate industry a “buyers market”. What this means is that there are more homes for sale then there are buyers. The good news for you is that you can get a great deal on a home right now. Many of the homes we are seeing are being sold for lower than what the current appraisal value is at. This creates instant equity for you and your investment.
#4 Principal Reduction Will Increase Your Equity
Each month, part of your monthly mortgage payment is applied to the principal balance of your mortgage. Picture “amortization” as a moving scale, in the beginning years of your ownership you are paying more interest than principle. However the longer the loan stays in place the more the scale begins to tip in your favor. Soon your monthly payment will go more towards principle reduction than it will interest which will drive your balance down very quickly.
#5 Appreciation
I saved this one for last because even though it is a VERY strong reason to get into a home it still is a variable. Our Seattle market however is still the strongest in the nation with no signs of slowing down. It has been driven by our stellar economy and the fact that our homes are so closely grouped together. Think about it…you can’t build east (mountains) you can’t go west (ocean) and unless you want to have a ridiculous commute, you have to stay centralized. Right now in our market it’s safe to say that your appreciation will still be in the range of 5% – 10% per year depending on the area.
So there you go, those were only 5 of the MANY reasons why home ownership is one of the best investments in your future that you will ever make. I know that there are many more out there and I would like to hear from each of you to see if you could add a few to the list.
However I am going to throw a little incentive out there. So here we go:
For the best reason why home ownership is a good option I will personally send a $10 Starbucks Gift Card (or any favorite coffee shop) to you.
Just make sure that you include a phone number or email address in your comments. So I can get a hold of you.
Dedicated to your Success,
Kenton Becker
kentonb@empireoptions.com
Managing Partner / Lakemont Mortgage Specialist
http://www.empireoptions.com/
Managing Partner / Lakemont Mortgage Specialist
http://www.empireoptions.com/
2 comments:
Good Article. I just recently purchase a home after renting for over 10 years! Yeah, it was to say the least very exciting to finally get into my own place. I wasn’t able to purchase the home in my name right now but instead did a lease option on it. That way I can buy the home in the future without worrying about the price going up.
I think one of the biggest reasons for me with wanting to get into home ownership is that I just wanted to call something my own. Also, you never know what your landlord is going to do and I didn’t want to find out one day that he was going to kick us out for no reason. By owning my own home, now I feel like I have control over the situation.
Thanks,
Tom
I just received this email from one of our clients.
"Nobody can tell me "NO PETS/NO SMOKING". I don't have to answer to anyone with a superiority complex and there is no chance of losing my Damage Deposit."
That’s definitely a great reason.
Thanks,
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