There are many wonderful benefits to owning a home, yet some go unnoticed or unreported. As a result, let’s take a new look at these benefits, including several that you might not be aware of:
1. Tax advantages
You can deduct both mortgage interest and property taxes from your annual income taxes as a homeowner. If you’re a first-time home buyer, you’ll reap even more benefits because the majority of your mortgage payment goes toward interest.
2. Appreciation in value
Houses usually appreciate in value over time. According to the Price-Shiller Index, the average yearly increase in the price of existing residences was 3.4 percent from 1987 to 2009.
3. Inflation protection
The rate of inflation tends to surpass the rate of increase in housing expenses and rents. Despite the Federal Reserve’s efforts to keep interest rates artificially low, inflation will eventually emerge, making all types of purchases, including homes, more expensive.
4. Credit enhancer
If you pay on time and in full, your FICO score will rise, allowing you to finance future purchases at lower interest rates.
5. It can help you establish equity.
The difference between the home’s worth and the owner’s total debt to the mortgage lender is equity, or the portion of the house that the owner has previously paid off.
6. Access to credit
Additional home equity allows you to take out a second mortgage in the form of a home equity loan or a home equity line of credit to borrow more money.
7. Move-up strength
Property equity also allows the owner to earn more from the sale of their home and put that money toward the purchase of a new home. The accumulation of equity and appreciation in a first property aids the transition to a second.
8. Home ownership can be used to help manage personal finances.
You know exactly what your payments will be during the life of your loan, especially if you have a fixed-rate amortized mortgage.
9. Simple savings strategy
You’ve started a forced savings strategy by paying your mortgage on time every month.
10. Gains in capital
How do you say “relief” in English? The Taxpayer Relief Act of 1997 provides relief to homeowners by exempting them from paying capital gains tax on the first $250,000 of gain if they are single and $500,000 if they are married, as long as they have lived in the home for two of the previous five years.
We want a safe, calm setting where we can leave our troubles at the door and spend quality time with those we care about. We want to come home to a home that is personalized to our needs and aspirations after a long day at work, and a newly constructed home gives just that. Visit us at home builders in mornington peninsula, where we can provide you with all the necessary information in preparation for building your dream home.