By Sharon Jones
Buying a home used to be the american dream. Because of the crash of ‘08, house buying had lost its appeal, but it is making a comeback. Housing prices are rising and the market has firmed up. Because of this, the question remains, is it a good idea to buy a house in today’s market?
There are some obvious benefits to homeownership, but buying a house can benefit the purchaser in some lesser known ways. In order to fully take advantage of these benefits, buyers should use some of the tools widely available on the internet.
One advantage to home ownership comes from the way homeowners get tax relief. When you buy your home you can write off the interest, file for depreciation even when your home increases in value because there was cost in maintaining it. And if you are concerned that these write could trigger a tax audit, there are also audit assistance resources available to alleviate your worries. In the past that might require a team of accountants and lawyers, but now we have the power.
Photo Courtesy of Kolter Homes
Another advantage is that your monthly housing expenses go towards your home’s equity instead of someone else’s. When you combine the fact that you are paying yourself with the reality that your house will likely increase in value over time, you are not merely paying for a place to live, but investing. And there are so many resources, like mortgage calculators, mortgage checklists and online real estate search engines, to help you determine your risk tolerance and level of financial commitment you want to engage in. It’s easy to anticipate that you will earn more in the future, but that is not a given. When you calculate your potential mortgage, you can project your future tolerance as well as current to choose the right amount that you are willing to borrow toward a home.
An advantage most people rarely realize is that your home becomes a savings account. This works because you can borrow against the equity of your home if you need money. This doesn’t require refinancing. Most homeowners can simply get a homeowner line of credit or HELOC. This is a secured line of credit and because the credit is leveraged against the value of the house you can usually borrow at rate near mortgage rates, potentially saving you the expense of high rates typical to credit cards or other forms of unsecured credit. This can be an inexpensive option to consolidate debt or help finance important projects.
Ultimately, we spend a lot of time in our homes. When we own them we take better care of them and enjoy them more. It’s important to understand that they have the potential to give back to the buyers more than merely providing a quality place to hang our hats. They are resources that are no longer to be feared. They are investments that provide you with shelter and they are assets that can lower the costs of financing those necessary projects, expected and not. And no matter what, if you can afford your payments, your house is valuable, because you’re going to have to pay to live somewhere.