1. Home ownership can help you build equity over time.
2. Your monthly payments will remain stable.
3. You may have some tax benefits.
4. You can take pride in ownership.
5. Home ownership improves your community.
Home ownership can help you build equity over time.
Every three years, the Federal Reserve conducts a Survey of Consumer Finances in which they collect data across all economic and social groups. The latest survey, which includes data from 2010-2013, reports that a homeowner’s net worth is 36 times greater than that of a renter ($194,500 vs. $5,400). Also, now the net worth gap is 45 times greater.
Your monthly payments will remain stable.
When you purchase a home with a fixed rate mortgage, the majority of the payment (principle and interest) remain constant. On the other hand, rents continue to skyrocket. Your housing expense is much more stable if you own instead of rent.
You may have some tax benefits.
There are several tax advantages to home ownership.
• Mortgage Interest Deduction
• Property Tax Deduction
• Imputed Rent
• Profits from Home Sale
You can take pride in ownership.
Most surveys show that a major factor in purchasing a home is the freedom you have to design the home the way you want. From paint colors to yard accessories, you don’t need a landlord’s permission to make the house feel like a home.
Home ownership improves your community.
Home ownership does create social capital and provide residents with a platform from which to connect and interact with neighbors. Owning a home means owning part of a neighborhood, and a homeowner’s feelings of commitment to the home can arouse feelings of commitment to the neighborhood, which, in turn, can produce interactions with neighbors.
Bottom Line
There are many benefits to homeownership. That is why it is still a critical piece of the American Dream.