When Buying a Home Makes Sense
Many first-time home buyers ask why buying a house makes sense. Your home is most probably the single largest purchase people will make for the next decade. This is a big deal, and deserves to be respected and treated with the appropriate attention. After all, all people who have never bought a home previously have known is renting, so that is a known experience and committing to buying a home can be scary. Having a great Wichita Falls REALTOR® is important to act as a guide and consultant throughout this process.
When Buying a House is an Investment
For most people, their home is not only the largest purchase they make, it is also the largest investment. When considering your long-term financial life, one of the most important considerations is net worth. A person's net worth is calculated by adding up everything that is owned. The current market value of any cars, the house, stocks, bonds, bank account balances, etc. Then add up everything that is owed such as the balance on a car note, remaining mortgage balance, credit card balances, etc. Then a person's net worth is calculated by subtracting the sum of everything that is owned from the sum of everything that is owed. If the number is positive, then that person has a positive net worth, and if that number is negative, than the person has a negative net worth. One of the differences between the wealthy and the poor or middle class is that the wealthy people focus on increasing net worth rather than income. Each month your mortgage payment is made, your net worth increases. When you buy a home, your mortgage payment includes four parts, principal, interest, taxes and insurance (PITI). The principal portion of your mortgage payment decreases the balance on the loan therefore increasing your net worth even if the value of the house stays the same and never appreciates.
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