appreciation: The Top 5 Benefits of Owning a Home
- 06/26/23 07:51 PM
Purchasing a home can feel like an overwhelming project, but the long-term advantages of homeownership make it a smart investment to secure your future where the benefits extend beyond simply having a place to live. Building equity is one of the most significant advantages of owning a home. As you make mortgage payments, your equity increases, and over time, your home can become a valuable asset to use the equity to finance home improvements, pay for college tuition, or even as a down payment on a second home. Two factors determine equity; the home going up in value and the unpaid … (2 comments)
appreciation: A New Perspective on the Housing Market
- 06/09/23 07:31 PM
The housing market in 2021 and part of 2022 was anything but normal. Mortgage rates were at all time lows and may never reach those levels again. Double-digit appreciation drove prices to new heights. Low inventories fueled by high buyer demand made multiple offers a normal expectation. As we look at the market snapshots provided by MLS in the various markets across the U.S., it appears that things may be returning to normal, but not necessarily in all areas. While there are more homes on the market now than a year ago, there are less sales due primarily to the doubling of mortgage rates … (2 comments)
appreciation: Cost of Waiting to Buy in Both Price and Interest Rates
- 04/04/22 12:45 PM
Have you ever been shopping on a website where you were looking at something that was on sale? You were interested in it but there wasn't a sense of urgency and maybe, you had a lot going on and didn't get back to it for a few days. When you did go back to the website, the price on the item had returned to its regular price. How did you feel? Did you go ahead and purchase it for the current price? How did that make you feel knowing that if you had acted more decisively, you would have saved money and had the product … (2 comments)
appreciation: The Dynamics of Home Equity
- 03/16/22 09:07 AM
Appreciation and amortization are key factors in building equity for homeowners with mortgages. As the home goes up in value due to appreciation and the unpaid balance goes down due to amortization, the equity increases. Appreciation is the increase in value of a home and is usually measured year over year. In recent years, appreciation has been robust (19% nationwide in 2021) due to high demand and low inventory. Many times, the news will quote annual appreciation rates from a national or regional level. Occasionally, you may see a chart that tracks the annual appreciation over a period, but it is more interesting … (0 comments)
appreciation: Doing Nothing is Costing Something
- 07/21/21 09:57 AM
It has been said that more money has been lost due to indecisions than ever was due to making the wrong decisions. Many times, the larger the decision, the more likely procrastination comes into play and doing nothing will cost something. Buying a home is certainly one of the biggest decisions people make. Careful consideration and planning are necessary steps leading to a prudent decision. Considering today's market that includes a global pandemic, financial volatility, and rapidly rising home prices, it is understandable that many people thinking about a home purchase are in a wait and see posture. However, there is a cost … (1 comments)
appreciation: It's Worth Digging a Little Deeper
- 09/06/20 07:20 PM
There are hundreds of thousands of people who believe, for one reason or another, they cannot afford to buy a home currently. Some people may not for any number of reasons but it would be very surprising to know how many who can buy but have gotten some bad information along the way. It's worth digging a little deeper to find out the facts. John and Karen have been renting a home for the last five years at $2,000 a month. During that time, the value of the home they were renting went up by $30,000 in value while the unpaid balance decreased … (1 comments)
appreciation: Rentals are IDEAL
- 04/13/17 08:13 PM
Rental homes are the IDEAL investment because they offer a higher rate of return than other investments without the volatility of the stock market. With certificates of deposit and bonds at less than 2%, people need an alternative investment that they understand and with a reasonable amount of control. In this case, IDEAL is an acronym identifying the advantages of rental properties. Income from the monthly rent contributes to paying the expenses and a return on the investment. Depreciation is a non-cash deduction that shelters income for some investors. Equity buildup occurs with amortized mortgages because each payment is composed of interest … (0 comments)
One of the big banks has a voluntary program available that transfers $100 each month from your checking account to your savings account. In five years, the account owner would have over $5,000 because of a type of forced savings.
Similarly, when a person buys a home with a standard amortizing loan, each month, a part of the payment is used to reduce the principal loan amount. Amazingly, over $4,000 would be applied toward the principal in the first year of a $250,000 mortgage at 4% for 30 years. In five years, … (2 comments)
appreciation: Indecision Costs By Making the Wrong Decision
- 08/01/14 11:42 AM
Indecision Costs - 7/21/2014 More money has been lost to indecision than was ever lost to making the wrong decision. The economy and the housing market have caused some people to take a “wait and see” position that could cost them in lost opportunities as well as almost certain higher costs in the future. To illustrate what the opportunity cost might be, let’s compare what the value of the down payment two years from now would be if it was invested in a certificate of deposit, the stock market or used to purchase a home today. A 3.5% down payment on a … (1 comments)
appreciation: 50 Percent Off Housing Costs
- 05/30/14 10:20 AM
Cut Your Housing Costs in Half Serious shoppers wait for a 50% off sale to make the decision because of the bargain factor. Renters who are serious about lowering their monthly cost of housing should consider buying with today’s low mortgage rates. For an example, let’s assume a person buys a $200,000 home with 3.5% down payment on a 4.5% FHA mortgage for 30 years. The total house payment would be approximately $1,508 per month. However, once you consider the equity build-up due to normal amortization, a monthly appreciation estimated at 2% annually for this example, the tax savings and paying maintenance … (0 comments)
appreciation: Let Your Tenants Send Your Kids to College
- 12/10/12 01:23 PM
Let Your Tenants Send Your Kids to CollegeMost people have lots of things to save for but not always enough discretionary income after the family essentials have been met. A relatively small investment in a rental home can control a good home that will easily rent, generate positive cash flows and pay for itself. The borrowed funds create leverage that earn a return on the total value of the home and not just the amount of cash you have invested.The strategy is simple. Find a slightly below average priced home that will rent well. It will appeal to a larger group … (0 comments)
The combination of good prices and low mortgage rates make it considerably cheaper to own than rent in most markets. Assuming a person is qualified with a down payment and won't be moving for several years, there may not be a better time to buy a home.
In the example below, the total house payment is $1,281.01 compared to $1,500 to rent the same home. Before you consider any of the financial … (5 comments)
appreciation: Rental homes can be the IDEAL investment
- 02/20/12 01:37 PM
Rental homes can be the IDEAL investment in today's market because they offer a much higher rate of return than alternatives without the volatility of ups and downs in the stock market. IDEAL serves as an acronym to identify the advantages of rental properties: Income from the monthly rent contributes to paying the expenses and a return on the investment Depreciation is a non-cash deduction that contributes a tax shelter Equity grows monthly as the mortgage amortizes due to some of each payment being applied to the principal Appreciation is achieved as the value of the property goes up Leverage … (3 comments)
appreciation: Forced Savings...Really?
- 01/10/12 09:18 AM
Forced Savings...Really? Part of the American Dream is to own a home. A home is a place to call your own; a place to raise your family and share with your friends. A home is a place to feel safe and secure. A home is a good investment? In a recent report* by Beracha and Johnson, it is suggested that buying a home is the right thing to do but not necessarily for the reason that people expect. A home is, in many instances, the largest investment that homeowners have and it accounts for the … (0 comments)
Purchasing a home can feel like an overwhelming project, but the long-term advantages of homeownership make it a smart investment to secure your future where the benefits extend beyond simply having a place to live.
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