Buying a home is a big step. But it’s more than just a place to live; homeownership is an investment that will help you improve your financial well-being in the long run.
While owning a home can have challenges, the homeowner benefits that accompany purchasing your property can help grow your wealth, increase your retirement savings, and improve your financial future.
Let’s look at the top ten homeowner benefits that make buying your home totally worthwhile.
1. Tax Benefits
Yes, taxes are unavoidable. But, one of the most popular homeowner benefits is the built-in tax advantages that accompany owning your own home.
The interest you pay on a mortgage is tax-deductible, and for the first several years of your mortgage, most borrowers pay a significant amount of interest each month. This means you get a sizable deduction at tax time.
Borrowers can also deduct a number of home-related expenses, such as certain repairs or home improvements. To find out all the ways homeownership can help reduce the amount of money you have to pay to the IRS, check with your tax preparer or accountant. Their comprehensive tax knowledge can help save you hundreds, if not thousands, of dollars in income tax over the lifetime of your mortgage.
2. Fixed Monthly Payments
If you’ve opted for a fixed-rate mortgage, you can safely calculate the amount of money you have to pay at the end of each month. When you’re working out a monthly budget, the stability that fixed monthly payments bring to the table is invaluable.
Knowing precisely how much you need to pay for your mortgage allows you to keep careful track of your finances. This can be a great relief if you have been renting recently and worrying about potential rent increases or unexpected fees.
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3. Personalization/ Changing Things In Your Home
When you rent an apartment or house, you often need to get your landlord's approval for even the most minor home renovation, like painting a wall or hanging photos. Homeownership means you don't need anyone's permission to make changes in your home that reflect who you are.
It's no wonder why so many people consider personalization one of the most popular homeowner benefits. Your home should feel welcoming when you walk through the door; your kitchen should work the way you want it, and when you own your home, you can ensure it does just that.
Another great thing about personalizing your home is that the home renovations you complete will likely bump up your property value. The new kitchen you install or the new garage you build will make your home worth more than you initially paid for it.
4. Grow Local
Everyone enjoys being a part of a community, and when you buy a home, you're putting roots down into a community. You aren't just another temporary renter.
Homeownership gives you roots, allowing you to become part of the surrounding community. Establishing neighborhood relationships with the people around you helps you develop a strong sense of community and connectedness, something essential to a long and healthy life.
5. Mortgages Mean Savings
When you buy a home, your mortgage helps you by building equity in your home. With each payment, a portion goes to interest (which is tax-deductible), and the remainder goes "into" the value of your home.
Each month, you own more and more of your home. That automatic increase in home equity has a real-world value that you can dip into for things like debt consolidation or home repairs.
When you pay off your mortgage in full, you'll have an asset worth hundreds of thousands of dollars, and you don't need to do anything except pay your mortgage on time.
6. Mortgage-Free Retirement
Buying a house in your twenties, thirties, or forties can mean mortgage-free retirement living. Once you own your home, you no longer need to make mortgage payments. Imagine not having to make one of the most significant monthly payments most people have, ever again, even into retirement.
When you retire, your budget becomes even more friendly. You can expect minimal monthly housing costs such as property taxes and utilities but no mortgage or rent. Imagine what you can do with all that money and free time.
7. Personal Benefits
Fannie Mae's most recent National Housing Survey found that Americans' top three homeownership benefits had nothing to do with money. Survey respondents said homeownership provided them:
- control over what they do with their living space
- a sense of privacy and security
- a good place for family and to raise children
Additional non-financial homeowner benefits included feeling a part of a community and experiencing less personal stress.
8. Your Home Will Increase in Value
If you live in your home for a long time, most homes will increase in value. In other words, if you did nothing to your home other than take great care of it, you could potentially see a nice profit from selling it in the future. Any home renovations or other improvements you do will only serve to drive your potential profits higher.
9. Improve Your Credit
One of the natural homeowner benefits that come with purchasing a house is that you improve your credit. By making mortgage payments in full and on time, you can increase your credit score while demonstrating to potential lenders that you are a responsible, reliable borrower. It also shows lenders you can handle significant financial commitments, which can help you if you hope to make additional large purchases in the future.
10. Low Mortgage Rates
Today, borrowers have access to some of the lowest mortgage rates ever offered, translating into savings for homeowners. And when you consider that you can deduct those interest payments on your income tax return, it can almost feel like you aren't paying interest at all.
If you're considering buying a home, reach out to the licensed loan officers at River City Mortgage. We're ready to help you get all the information you need to help you make the right mortgage product choice for your family.
Get in touch for a free consultation today.