Ways That Homeownership Increases Wealth
The American dream is different for everyone but no matter what it has always involved becoming a homeowner. Homeownership can change your life in more ways than most people realize. Not only will it provide comfort for you and your family in a space that you can make your own, but it can increase your wealth and the wealth of future generations in your family. It may seem like an unattainable dream but we promise you it is not. That’s an article for another day though. For now, here are a couple of ways that buying a home can increase your wealth.
Home value appreciation: When you purchase a home, chances are the value of it will increase over time. National appreciation values average around 3.5% to 3.8% per year. This means that once it has gone well over what you paid for it, you can sell it for much more and buy another, bigger, and better home.
Tax deductions & mortgage rate deduction eligibility: The IRS offers tax breaks for those who own homes. Mortgage deduction allows for an interest deduction they pay on their mortgage loan throughout the year.
Building equity versus renting: When you pay the mortgage and not rent (someone else’s mortgage), you build equity. Eventually, when you pay off your mortgage, you are debt-free with a home—no more mortgage. You can see why it’s smart to purchase and not just pay rent. When renting, you will never own that property. Unless of course, you rent to own but that’s a whole different story.
There you have it. 3 GREAT reasons may change your mind on why buying a home is the best choice. There are obstacles but nothing that can’t be tackled with a plan and the right help. Buying a home is the smart choice if you want to build equity and increase your wealth over your lifetime. Especially if you have children that can later benefit from your brilliant decisions.