1. Positive return on investment
The last thing you ever want is to lose money on your investment. Home prices statistically increase over time not decrease. If you plan to stay somewhere long-term. Buying is the best financial option.
Every mortgage payment you make brings you closer to owning your home outright. Every month you build more equity for yourself. Each rent payment makes your landlord wealthier. That’s something worth keeping in mind.
2. Mortgage and property tax breaks
If the mortgage itself is smaller than the price of the home, you can deduct the interest. Basically, if you’ve been paying down the mortgage you get a tax break. This saves you money. With the tax breaks, many find owning a home more cost effective than renting.
3. Low interest rates
Right now interest rates are low. You want to snag that mortgage before they go back up. Lock in your affordable rate.
4. Rent prices are increasing
Receiving notice that the rent is going up is never pleasant. But it’s part of being a renter. If they go up too much you can’t afford rent. You must move. Rent fluctuates based on supply and demand. The demand for housing is high and rent prices are following suit.
Your mortgage rate does not change. You won’t suddenly be charged more on the house in your name. It’s yours and you bought it. Rent prices rarely decrease. So don’t count on a nice letter from the landlord telling you your rent is going down next year.
5. More supply and lower prices
Were you trying to buy a home last year? It was probably a frustrating and expensive experience. There were not many options. Since supply was so low, prices were high. But 2019 is off to a better start. According to chief economist Danielle Hale, inventory is higher and the prices are only supposed to increase by 2.2%. Much better than the 5% increase last year.
What’s your price range for a home? If you are looking for a home for under $300,000 there are fewer options. But if you are looking for a higher end home there are more of those available this year.
6. Capital gains exclusion
If you have ever paid capital gains taxes it hurts. You hand over up to 28% of your profits from a sale to the government. But if the sale is from real estate you may qualify for the capital gains exclusion.
- Did you live in the home for at least two out of five years? If you are married, you can deduct up to $500,000. Single investors can deduct a maximum of $250,000.
- You don’t have to turn around and buy another home right off the bat.
- There is no age limitation on the exclusion. If the home was in your name you qualify. It doesn’t matter if you are 30 or 65.
- You can take advantage of this exclusion every two years. It’s not a one-time deal.
7. The pride that comes with homeownership
There is a certain pride that comes with home ownership. This is your investment and you worked hard to buy it. But it also gives you stability and security. Want purple walls? A mural in the living room? Go for it it’s your home. You can remodel the kitchen if you want to. Add another bedroom too if you need to. If you sell, these upgrades will allow you to sell the home for more money.
If buying a home is on your mind now is the time to take the plunge, call us toll-free at 877-255-3554 or click here to start the pre-qualification process.