Owning a home can be attainable for anyone. That’s why we want to ensure you know how homeownership helps you build long-term wealth and things to consider before you get started.
Has owning a home always been a dream of yours? If so, you’re not alone, as most Americans equate homeownership as one of their major life goals. Owning your own home may still seem like a dream, but you can make it a reality by starting to save and planning ahead. Before you know it, you’ll be ready to purchase your first home!
Everyone’s personal situation is different, so you’ll need to take the time to consider whether you’re ready to own a home. Whether you’re still renting or waiting until the time is right to start looking at homes, you’re probably weighing the pros and cons of homeownership. If you’re looking for more information on the path to homeownership, and the stability and peace of mind it can bring, keep reading because we’re going to cover the following:
- How do you know if you’re ready to own a home?
- The top benefits of homeownership
First, make sure you’re ready to own a home and start building your equity
You’ll want to take a look at your financial situation to make sure you’re ready to own a home and start building your equity
While owning a home may seem like a great idea and the next logical step for you, it is a significant investment, so you want to ensure you’re ready for it. You’ll want to examine your current financial situation and ask yourself some essential questions first.
- Is this a sound financial decision? Before purchasing a home, you should ensure you have saved the right amount of money. The housing market varies, and depending on where you live, houses may be more or less expensive than the national average. How much money you’ll need for a down payment, closing costs, and the monthly mortgage will vary.
- Does your job require you to relocate often? If you’ve been renting because it offers you the freedom to move around for your job, you’ll want to consider that before you purchase a house. It can take a few years for a place to start to build equity, so renting might be a better idea if you’re looking for a short-term living situation that you can change frequently.
- Do you still need to build credit? Before providing a loan, lenders must look at your credit score and determine how financially stable you are. If you’re still working on building credit, renting for a bit longer might be a better decision.
- Are you looking for more stability and a way to build wealth? If you want to start building wealth and equity, and your finances are ready, you may want to reach out to a real estate agent or realtor to begin your journey to homeownership. When you walk away from a lease, you don’t have anything to show for it; however, when you start paying on your mortgage, you’re gradually building wealth, equity, and a legacy you can pass on.
The benefits of homeownership
There are many benefits to owning your own home!
Owning a home has so many benefits, including the peace of mind you get from being a part of a community!
If you’re ready to start down the homeownership path, you should know about the benefits you’ll experience by owning your very own home.
- Long-term savings
Although the upfront costs of home ownership may be steeper, in the long term, you’ll see savings. When you get a home loan with a competitive interest rate, you’ll know exactly what you pay monthly. You can save money or build wealth elsewhere with more control over your monthly expenses.
- Appreciating investment
When you can purchase property, it will likely continue to appreciate or increase in value over time. This means that regardless of the price at which you are buying, your home will most likely continue to rise until the time comes to sell it, which you can then do at a profit! When renting an apartment, you have no rights to the property, as a landlord owns it.
- Build equity
This is one of the most significant benefits of owning a home, which is why many people make it their goal to one day purchase a house. Each month when you make payments on your mortgage, you increase the value of your ownership in an asset (your home). Each year you increase your equity, which can come in handy should you borrow against that equity and take out a home equity loan or line of credit to help with improvements or an emergency. You’re creating lasting wealth for yourself and your family when you purchase a home.
- Tax advantages
In addition to building equity and having your home value appreciate over time, there are also tax advantages to owning your home. The most significant incentive to homeowners is the Mortgage Interest Deduction, which allows homeowners to deduct the interest paid on their mortgage to lower the taxes owed. However, as a homeowner, you may also qualify for:
- Property tax deductions
- Capital gains
- Financial education to pass on
When you go through the home buying process, you learn a lot about the financial ins and outs of the procedure. Teaching your children how to manage monthly expenses and make a mortgage payment gets them on the path early to understand how to purchase a home successfully. Passing on financial literacy is a great way to leave a lasting legacy and proof that anyone can own a home.
- Strong sense of community
Homeowners tend to stay in their properties longer, strengthening community ties and a greater understanding of stability. When you own a home, you take pride in its appearance, which keeps the community more active and engaged. This can even translate into greater civic participation in local affairs.
- Privacy, freedom, and control of your environment
With your own home, you’ll no longer share walls with others or have common areas everyone uses. Homes offer greater privacy and the freedom to design and improve your space as you see fit.
- Lower crime rates
With stronger ties to neighbors and the community, areas with homeowners may experience lower crime rates, including property crime. When neighbors are looking out for each other, crime deterrence is higher. This sense of security is one of the major benefits of purchasing a home.
If homeownership is your dream, many benefits await you. If you’re ready to explore if homeownership is right for you, contact one of our Mortgage Loan Originators to get started today!
