For those people contemplating buying a home, this couldn’t be a better time. Real estate prices are the lowest they’ve been in years, with great financial gain to be made in the long term. Due to lower mortgage loan amounts, home ownership financial advantages are now outweighing renting a home. For those who have the means to purchase home and want the personal satisfaction that comes along with it, the time may be prime to enter the market rather than waiting and seeing home prices start to rise.
Here are five reasons that may help you decide to finally stop renting and take that big step of home ownership:
1. Low Prices – Real estate home prices are at a low.. Many homes have had their values decrease by up to 50%. Often, mortgage payments would be less than what it costs to rent. Home prices will not remain this low for ever, now is the time to purchase a home prior to home prices increasing in the years to come. It’s nearly impossible to figure out the lowest peak of real estate, but with home prices having decreased so much it is rather hard to imagine a better time for buying.
2. Tax Advantages – Home mortgage interest expense is tax-deductible up to $1 million dollars. Also, any gains realized when selling a home is excluded from taxes up to $250,000 for single taxpayers and $500,000 for couples filing jointly. Although some states have a rental home deduction, the amount is minimal compared to the interest expense allowed for homeowners.
3. Building Equity – Each mortgage payment includes a portion to pay down the loan. Each time a loan payment is made, the homeowner is building equity in their home. Additionally, when the market starts rebounding and property values start to increase, the equity in their home will also increase. This equity can quickly build up within a few years in a rebounding real estate market. Unfortunately, renters have no equity being gained through making payments to their landlord.
4. Security – Owning a home gives the owner a sense of security knowing that they can live there as long as they want. No one is able to tell them it’s time to move. Renting a home is at the peril of the landlord. Once the lease period has ended, the landlord has the right at any time to ask the renter to leave. The renter has no recourse but to start looking for another place to live. Buying a home gets rid of all this insecurity, but rather gives the new homeowner time to enjoy and fix up their home, rather than worrying about how long they get to live in the house.
5. Peace – Homeowners have what renters do not have, living free without rules. This means a homeowner can paint the walls any color they want, have as many pets as desired, and renovate their house at any time. Of course, city or condo/townhouse association rules will apply, but beyond that, freedom has been obtained. Renters sometimes feel manipulated by their landlords, and often times have the feeling of stress from not being allowed to live as they please.
Real estate is at it’s lowest point in years, it’s a great time to buy and start having the tax savings and equity building of home ownership. The idea of owning a home and having the freedom and security obtained, is quite attractive in this tumultuous economy. Real estate is bound to recover in the coming years, the decision to buy should be made now while prices remain low. Enjoy buying the home of your dreams at a price that is affordable.