The benefits of home ownership

Jul 5, 2023 | Ask the Realtor

Rosemarie LaBadie

I was watching the news this morning and the news anchor announced some home buyers are “quietly quitting.” Apparently, they are frustrated with the pricing and not being able to find a dream home in their price range.

If you are considering quietly quitting, let me share with you a few benefits of home ownership.

Real estate is one of the best ways Americans build wealth. When you invest in real estate, you play the long game. It’s supposed to appreciate slowly, not the double digit gains we experienced the past few years. So, while you are living in your investment, it’s gaining value.  Now, it may lose value for a few years, but you just hold. The big benefit is when you sell.

Home ownership is part of the American Dream. That’s why the government has set up finance programs for inexperienced buyers. These loans are called FHA or USDA loans. Both of these loan programs require very little downpayment, which allows people with limited funds to purchase their first home.

What ends up happening is, after a few years, the former inexperienced buyers are ready to buy a larger home. They are more experienced home shoppers, have more credit history and have a sizeable downpayment from the sale of their first home.

Another benefit of home ownership is no other investment puts a roof over your head. When you invest in stock or mutual funds, you still have to live somewhere.  Plus, you know exactly what your house payment will be – unlike renting, when the landlord can raise the rent every year. Or even worse, they announce they want to sell the property, and you must move out.

Plus, home ownership allows you to truly express yourself. You can paint the walls any color you choose. Or put in a new kitchen with the sink you always dreamed of. You can even personalize your yard. The best thing is all your endeavors pay off when sell. Unlike renting when the landlord reaps the benefit.

Another benefit of owning real estate is the tax deductions. In most cases all the interest you pay over the course of the year is a deduction. So, you pay substantially less federal tax. I have an investor who told me he always bought when the interest rate is high. He said he gets a better bargain, a bigger tax deduction and can refinance when the interest rate comes down.

Many folks use the equity in their home to help pay for their children’s college education. You miss that opportunity if you pay rent. Once you pay your landlord, your money is spent. A house payment is almost like depositing into a savings account.

Happy 4th of July and enjoy our five freedoms: freedom to be healthy, freedom to be economically secure, freedom to learn, freedom to be free from hunger, freedom to be safe from harm.

If you have a real estate question, I’d love to chat with you. Give me a call at (909) 338-9995.

Rosemarie Labadie, Broker, CA DRE #01240715.


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