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Buying your first home, or even your second or third, provides you with the opportunity to secure and establish a strong financial future and juggle the many responsibilities that come with homeownership.
Here are a few financial benefits of homeownership:
Pride: Buying your own home typically gives a greater sense of accomplishment than renting does. Being able to own your own home and decorate/furnish it however you prefer can be very liberating. Your home then becomes an extension of who you are, which brings a sense of pride. According to a recent survey, American’s value owning their home just as much as being successful at their job.
Building equity: The longer you live in your house, the more equity you will build. With a rented home, you have no opportunity to build equity and instead, all of your money goes to the landlord and is never seen again. Owning a house for a long period of time will result in the value increasing, therefore becoming a great investment for retirement. When planning to retire, you can either sell the home and buy a smaller one, or you can rent out the house to others and collect a steady stream of income. Either way, you are profiting off of the value of your home and can use that extra money for travel or recreational activities.
Freedom to make modifications: When wanting to make changes or renovations to a house you are renting, you not only have to have the landlord’s permission to do so, but all the benefits of it go towards the landlord as well. If you own the house, you have the freedom to do whatever you want to it and you will reap all the benefits.
Long-term Savings: Buying a home could promote financial stability in the long run. When you own the property, you are constantly building equity which is money that is set aside for future use.
Stability and Security: Owning your home not only brings stability and security in the sense that you have an established shelter and community, but it also comes with financial security. When renting a home, the landlord has control over both the amount you spend on rent and the time before your lease expires. As a homeowner, you can secure a predictable mortgage payment for up to 30 years. Your housing budget also goes towards your own benefit, rather than a landlord’s.
Tax Benefits: Many expenses of owning a home, such as property taxes and accounting costs, are tax-deductible. A few other tax benefits of homeownership are: