Five Reasons To Buy A Home

1. Rent VS Owning:

Do a quick analysis of your living expenses. What are you paying in rent each month and is it time to buy a home.  Does your rent include utilities, phone, gas, water, electric, cable, parking. rental insurance. Calculate all of these together and find out how much your paying out to a landlord each month. Is it cheaper to own vs rent.  Typical expenses of homeownership includes mortgage payments, insurance, real estate taxes plus utility expenses listed above. There is one other major expense home ownership has which renters are not concerned with and that is maintenance. If anything goes wrong like furnace, hot water heater, new appliances, new roof, etc. these must be as a reserve when thinking about home ownership.

2. Savings:

How much money do you have in savings? Do you have enough money for a down payment? Typically a conventional loan will require 10-20% of the purchase price for a down payment but other expenses include a home inspection, attorney fees, 4 -6 months escrow reserves for taxes and insurance. If you have money saved is it invested and earning more money than you can on investing in a home?  Which leads to the next benefit Equity.

3. Equity:

One of the biggest financial benefits of home ownership is the ability to build equity by owning a home. Equity is the difference between the mortgage balance and the fair market value of your home. You will build more equity when the home appreciates if the fair market value is higher than what you owe. Historically a lot of people will rely on their homes value as a source for determining the Net Worth of an individual. Warning: We are now recovering from a declining real estate market where home values went down not up. You can never time the market but you should be warned that you should prepare to live in your home for 7-10 years to build up enough equity before you will want to sell.

4. Stability

Home ownership  has many rewards but the biggest reward is it gives you some stability. A place that you can call your own and build relationships with friends, family, neighbors, and community.

5.  Comfort:

Home ownership should give you quiet enjoyment and comfort and remember a house is just a house until you call it a home.

 

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