With interest rates near record lows I thought it could be beneficial to explain reasons for buying a home rather than renting a home. This a huge step for any who decides they want a home, but it is the right thing to do if your situation allows you. Here are five quick reasons to explain why buying is a better investment than renting a home.
1. Pride of ownership. Do you ever notice that people rent a car they tend to drive it like they stole it? People in general do not treat something that is rented or borrowed as well you they treat their own property. When you own a home you have the ability to make it yours. You can do what you want how you want, want to paint the wall bright pink with sparkles you can. Turn the A/C on with the windows open? Fell free you're the one who pays the bills. The home is your freedom.
2. Appreciation. Real estate is a living breathing creature and like every market it goes up and down. While the market has gone down in the short term overall real estate is the soundest long term investment you can make. Tends show that ultimately real estate appreciates in value over time.
3. Mortgage interest deductions. Tired of uncle sam getting all your dinero on April 15th every year? Buy a home! Did you know that you maybe able to write of the interest paid on your monthly mortgage? (consult a CPA). On all loans you pay interest fir than towards the principle of the loan. so for the first 15 years of a 30 yr loan a majority of your payment goes towards the interest. Write that Bad Boy off!
4. Property tax deductions. Check out IRS Publication 530. It says that all property taxes paid on a first home are completely deductable. Cha Ching$$$
5. Captial Gains. Do you know of may homes that have appreciated $200k or more in the last 5 years? if your single and have lived in your homes for 3 of the last 5 years than you could be exempt for capital gains taxes.
I hope that these five reasons or buying a home have informed you and helped you make the right decision for your specific situation. Please rememeber to always consult a CPA regarding all tax questions.
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