Buying a house is probably one of the best investments you can make during your lifetime. Understanding the benefits of homeownership means thinking of all the potential advantages and deciding whether it is right for you.
There are considerable upfront costs that come along with buying a home. Be sure to evaluate your financial health and make the best decision for you. If you need to, take time to build your savings and improve your credit score before buying.
Once you’re ready, you should be in a great position to score a low interest rate and pay most of your upfront fees and taxes without additional stress. These benefits and last memories make the hassle worth it.
By making a mortgage payment every month, your money grows as an investment in your property.
A recent Harvard study reported that nearly half of renters are “cost-burdened” because their rent exceeded 30% of their income. Additionally, one in four renters pays more than half of their income on rent.
With a mortgage, you gain flexibility by developing equity, but it’s still wise to avoid spending one-third or more of your income on your housing costs.
During tax season, you can deduct mortgage interest, mortgage insurance, and property taxes you’ve paid throughout the year on your federal income taxes. If you make a profit when you decide to sell your home, you may not have to pay taxes on that either.
Depending on your location and other factors may qualify you for additional deductions. Be sure to talk with your trusted financial advisor to ensure that you’re getting every benefit.
The stability of a fixed interest rate mortgage locks in the principal and interest payment for the length of your loan. When it comes to renting, your monthly rate could be impacted by inflation or a greedy landlord.
It’s important to remember that additional monthly costs may have been taken care of in an apartment complex. Water, trash, lawn care, laundry, etc., can all be forgotten costs until you’ve overcommitted on your monthly payment.
You make the rules. You have the freedom to do whatever you want to your house – paint, decorate, landscape, and remodel to fit your lifestyle.
Whether you tackle an outdoor patio oasis, a bathroom retreat, or a professional kitchen- all of these changes are yours to make and customize how you want to.
Homeowners are more likely to be invested in their neighborhoods and neighbors. According to the U.S. Census (Table A-4), homeowners are four times less likely to move in a given year than renters.
An established neighborhood can give you a sense of community, stability, and security. If you have a family, it’s always nice to make friends in the area, find a school nearby, and build memories that stay with them in the long term.
Some families purchase a home to pass it on, fully paid off, to their children. This sentiment may be shared between your neighbors and can create a stable, safe neighborhood for generations.
This article is for educational purposes only. Tulsa FCU makes no representations as to the accuracy, completeness, or specific suitability of any information presented. Information provided should not be relied on or interpreted as legal, tax or financial advice. Nor does the information directly relate to our products and/or services terms and conditions.