When thinking about home ownership, there is more to consider than the current interest rate.
Stable Payments:
A fixed-rate mortgage ensures stable monthly payments, offering financial stability as cost-of-living increases. This predictability is a significant advantage over renting, where payments can rise with inflation. Even with changes in taxes and insurance, the principal and interest payments remain the same.
Tax Benefits:
Deduct your Mortgage interest, insurance premiums, and property taxes may be tax-deductible, reducing your overall tax burden. Talk with your tax advisor to understand the specific benefits you can enjoy.
Freedom to Renovate:
You own it, paint it any color your heart desires! Whether you want to remodel the kitchen, add a new bathroom, or create a garden oasis, owning a home allows you to customize your living space to fit your personal tastes and needs.
Access to Funds:
Borrow against your equity. This financial tool allows homeowners to leverage the growing equity in their home to finance improvements, renovations, or other needs. This can further increase the home’s value and provide additional financial resources.
Home Appreciation:
Owning a home is a powerful defense against inflation. In the scenario below, a home is purchased at the price of $550,000. As illustrated in the graphic below, even a modest annual appreciation rate of 3% would increase the home’s value to $739,000 over ten years (+$189,000). With higher appreciation rates, the benefits can be even greater. At a 7% appreciation rate, the home’s value could reach $1.08 million in 10 years (+$530,000), nearly double the original purchase price of the home.
If you are considering purchasing a home now or in the future, I hope these insights are helpful. To learn more about owning a home, reach out to us at the Expert Real Estate Team at 864-895-9791.
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