As discussed in previous posts, there are very definite and immediate benefits of home ownership. Aside from the tax deduction, there is the stabilization of one of the major monthly expenses – your cost of housing becomes fixed rather than subject to your landlord’s need to increase rent. Another benefit of home ownership is being able to accumulate and set aside something of value for the future. The great benefit of home ownership is you get to live in the very thing that is increasing in value. In other words it is not just an asset like a stock or a bond or a certificate of deposit (CD), it is a functional part of your day to day life. While other assets might increase in value more quickly for a given month or year, they will do nothing to relieve your need for a roof over your head.
Home Ownership And More
You can get into a home with no down payment when you are starting out. This first home will grow in value over the years and you will be able to use the profit when you sell to make the down payment on a house that meets your needs as the family grows and or work moves to another location. Because you got into home ownership, you find that you are riding the wave of home appreciation, instead of still trying to save money for a down payment and finding you are falling behind as homes are appreciating faster (10.1% on average for last year) than your annual pay raises (2.6% on average for last year).
A Better Future
Statistics show us that the average home owner moves every 8 to ten years. If we assume a mere 3% appreciation of home values per year, your home will have appreciated 22% by the 8th year and 30% by the 10th year you live there. This will give you enough of a down payment on your next home to avoid mortgage insurance. Why would you want to move? The reasons are as varied as there are people. Most often, the move is because the family has literally outgrown their first home. Probably the second most common reason is work. Either you land a new job with a longer commute or your company relocates to a different town or suburb. Being a home owner, you can used your equity to move to a more convenient home while keeping your housing expense reasonable.
Do you want to explore home ownership but don’t know where to start? Why not call/text me at 760 622 5087 to discuss your situation. Together we can map out a path for you, too.
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