Many people may feel skeptical about homeownership because of the economy over the last several years. However, homeownership can be a truly worthwhile investment if you choose a home that is right for you and your affordability. Take the following reasons into account when facing a possible decision to purchase a home:
1. It’s a Buyer’s Market: Right now there is ample inventory with affordable prices. If you have steady income and enough money for a down payment, the timing could not be better especially with interest rates at historical lows. This means huge savings over the term of your mortgage.
2. Equity: Many areas in the country are currently experiencing average home appreciation (4-6% per year), which is what should normally be expected. For areas that have been hit harder, experts predict that the housing market will recover. Why pay rent that will never amount to anything in the end when you could be making similar mortgage payments that turn into equity? Purchasing a home does require more initial expenses, but in the long run it will be a worthwhile investment that you can sell at a profit.
3. Freedom: As a renter have you ever wished that you could paint your walls a different color or have hardwood instead of carpet? As a homeowner the options are endless to fit your own taste! Owning a home truly means making it yours to enjoy and there are no consequences if you redecorate or renovate.
4. Community: Rentals can seem like a revolving door sometimes with neighbors constantly coming and going after living in the building a year or less. There is more consistency in homeownership (usually 5+ years to recover closing costs) which allows for people to get to know their neighbors and share the community that they live in.
5. No Hidden Fees: Has your rent ever been raised at the end of your rental term? If so, you don’t have to worry about that if you own a home and have a fixed-rate mortgage. Your monthly mortgage payment today is what it will be next year and the year after. This predictability allows for planning renovations, vacations, new car, etc. Of course there are costs that come with owning a home that can come monthly or annually (appliances breaking, window cleaning, etc.), but your major expense (your mortgage) will be the same year after year.