New Year, New House - Benefits of Owning a Home
Corey & Scooter
December 31st, 2022
Entering the new year, it's time to start setting goals for the coming months. Homeownership can bring so many positive benefits to your life, including Building Equity, Potential Tax Benefits, Making It Your Own, Appreciation Possibilities, and Stability. Let's get into it and review some of the benefits of owning a home!
1. Building Equity
Building up your equity by making your mortgage payments can be very valuable as you go through time and want to possibly refinance your home, or maybe even sell.
What does equity mean? Your homes' equity is what you have into the financial total of your house, or the value of the real property. This is the true price for your house according to the current market, leaving out any loans or anything attached to the property.
How do you use equity? For more information on how to use equity and build it with your property, read more here.
2. Tax Benefits
Building up your equity by making your mortgage payments can be very valuable as you go through time and want to possibly refinance your home, or maybe even sell.
Examples:
- Discount Points: you can purchase these when taking out a mortgage. This can potentially lower your interest rates on the loans you have with one point being 1% of that total mortgage amount.
- Business in Residence: you can own and operate a business within your home and possibly deduct some of these business expenses. These deductions come specifically from the costs of your 'business space'. You have to use this as your permanent office space, not simply where you sometimes work in your home office.
Find more tax benefits for owning a home here.
3. Make It Your Own
One of the benefits of owning a home is the fact that you now finally have the ability to completely personalize it and make it your own.
Ways to make it your own:
- Refurbish old decor left in the home by previous owners.
- Personalize the style of the home by painting and renovating without the worry of losing your security deposit.
- Update older appliances that came with the home-purchase.
Along with these examples of how to make it your own, small changes throughout the home can make a large difference as well. Little touches that make a house a home can be simply adding warm lights and extra cozy blankets. Go as big as you would like, and remember, it's yours now!
For more ideas on how to make your house a home check out my previous blog here.
4. Appreciation Possibilities
Like anything in life, you cannot expect appreciation to occur, but it's definitely in the realm of possibilities. As time goes on, you can gain financial benefit as the property appreciates in value. If you ever decide to sell your home in the future, you could get your investment back and much more.
Home Appreciation Explained:
This term explains the increase in value spanned over a certain period of time. This can help you, especially if you would like to use this property as an investment home. If you play your cards right and plan your investments, home appreciation can help you financially in your future.
Taking advantage of this appreciation can be done in a few different ways. One avenue is through a HELOC, which gives you cash in-hand from your equity. Depending on your age, you can reverse a mortgage as well, which allows you to take money from your equity.
For more of the many ways to take advantage of this, click here.
5. Sense of Stability
Owning a home can provide a sense of stability since you have a place to call your own and no longer have to worry about the fluctuations and uncertainties of the rental market.
Main benefit:
You no longer have to be subject to or concern yourself with the many market fluctuations regarding renting. Renters can raise the rent based on the area you live and this can severely impact your way of life. With this new stability, you can focus on the next steps in your life, life possibly starting a family!
This one can be easily forgotten as it's frequently just looked over. When we own anything in life, we know that we gain a sense of safety and stability. It is now something that we will not lose if we miss a payment or cannot afford the loan. You also no longer have to concern yourself with the many market shifts. Depending on the area you live in, this fact alone can be all the reason you need to own rather than rent. Stability is also incredibly important when planning for a family.
For more ways that owning a home provides you stability, check out this article that was released in August here.
While there are clearly many benefits of owning a home, it's not for everyone and should only be considered once you are at that point in your life that allows you to have the means for it. Before seriously considering purchasing a home, it's best to carefully review your financial situation and create a pros and cons list of your own to decide what is best for you. If you decide that this is the best route, what time is better than the beginning of the new year!
