Building equity in your home.
The number one benefit of owning a home is developing equity in your home. There are three ways that they typically do this. The first is by paying down the principle each month. Because a typical loan is amortized over 30 years, this benefit increases the longer they live in the home. Every month more of there monthly mortgage payment goes towards paying off there principle then the previous month. The second way home owners develop equity is through appreciation. In America homes typically appreciate in value 3-5% annually and in some areas that number can go up to as high as 10% annually. It is entirely dependent on the location of your home. The third way home owners can develop equity is by increasing the value of there home. There are many ways of doing this from simply cleaning up the home and adding a fresh coat of pain to doing a major overhaul or adding an addition on to the home.
Stable Monthly Cost For Years To come
The second benefit home owners enjoy is a consistency in there monthly payments. While renters have to worry about there rent increasing every time they sign a new lease, home owners monthly payments keep pretty stable over the life time of there mortgage. The only two variable that may adjust slightly are taxes and insurance.
Customize Your Home To Your Taste
Home owners also enjoy the ability to customize there homes to there particular taste and needs. If they don’t like the outdated tiles in the bathroom then they have the freedom to replacing them with something more modern. If there home layout doesn’t suit the needs of there growing family then there is nothing stoping them from hiring a carpenter to do some renovations. Renters on the other hand have almost no say in the finishes or layout of there homes and often even need permission before painting walls.
Save Big With Tax Deductions!
There are also many tax advantages to owning your own home. The biggest for many would be the ability to deduct your mortgage interest from your tax obligation at the end of the year. But some owners also enjoy the deducting some of there closing cost as well as deducting there property tax from there annual income tax.
Putting Down Roots
Lastly, purchasing a home gives you stability in your life. “putting down roots” as they say. Home owners typically plan on living in the same home for several years and sometimes even the rest of there lives. Renters on the other hand can hope to live in a home for several years but ultimately the decision wont be theres. A renters entire life can be upturned at the drop of a hat if a landlord decides to sell there property or raise rents.
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Maryland REALTOR at Keller Williams Select Realtors
Malcolm is an 11 year Air Force Veteran and is a part of a family team of Maryland REALTORS along with his wife, mother and sister in-law.