Why Buy A Home?

Homeownership has proven itself to be a wise long-term investment. Several reasons for being a wise investment include:

• Paying rent pays your landlord's mortgage. Every dollar you spend toward principle on your mortgage, that builds your equity and your wealth.
• Income taxes favor those who own a home. Additional deductions such as mortgage interest, property taxes, and some closing costs reduce the amount of money you pay in income taxes.
• When you finally do go to sell, your equity (original mortgage amount, minus principal paid) belongs to you, and is often not subject to income taxes.
• Having an advocate on your side working for you, ie, your Coldwell Banker Agent, costs you nothing out of your pocket. Despite the fact that your Coldwell Banker Agent works for you and represents your best interest, your Coldwell Banker Agent is customarily paid by the seller.
• Homes typically appreciate. This presents two benefits
  • First, let's cite an example: You purchase your home for $100,000. If you sell it 7 years later, your mortgage balance is at approximately $87,945. However, your home is now worth, $120,000, as an example. Instead of having more than $12,000 in equity, you now have $32,000 in equity!
  • Second, the longer you live in a home, the less expensive it is to you. That's because your payment doesn't go up on a fixed mortgage, as your rent payment would. You continue to pay your mortgage payment based on what you paid for the home when you purchased it. While rents are certain to go up over time, your principal and interest payments on your mortgage stay the same!
• Owning your home and paying your mortgage on-time every month helps to further establish your credit history. In addition, there may be other financial incentives to look into, such as a "homeowner discount" on your auto insurance.
• And, for purchases made, you may be eligible for an up to $8,000 First-Time Homebuyer Tax Credit.

In addition to the financial benefits of home ownership, there are also many psychological and "warm and fuzzy" benefits, too!

• There is a sense of stability and security in owning your own home. Your home is yours to enjoy as you see fit.
• For example, in your own home, you can decorate it and paint the walls to your taste. Changing light fixtures or renovating the kitchen is your choice to do, and if done right, will be a reward you reap in terms of additional home value when you later sell the home.

Ready to learn more? Visit "The Home Buying Process".

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