From a financial aspect there are many different reasons that a person should consider buying a home. A recent study done by Eric Belsky of the Joint Center of Housing Studies at Harvard University outlines a few of these different reasons to show people, especially first time homebuyers, exactly why buying a home isn’t just about pride in ownership, it’s also about the money.
One of the more obvious reasons to own a home is because whether you buy or rent, either way you’re paying for housing. Why not put that money towards your own mortgage instead of someone else’s? Along with homeownership also comes tax benefits. If you itemize, which most homeowners do, you are able to use your property taxes and mortgage interest as tax deductions on your income. Also, depending on your tax filing status, if you sell your property and make money on the transaction you’re able to exclude up to $250,000 for single filers and $500,000 for married from your income.
Another financial bonus to purchasing a home is that it is generally the only form of investing where you can borrow money for your own gain and profit. Every time the property value of a home rises, so does the amount of equity the owner has in that home. Owning a home also helps people save money. While this may not make sense because it always seems like there’s something needing fixed or repaired on your home, people feel a certain responsibility in paying their mortgage, keeping them from spending their money and saving it instead. Rent prices also seem to rise much quicker than home prices and interest rates do. What one person can afford in a home is typically much more than they can afford through renting.
Many people want to own a home simply to have something they can call their own, which isn’t a bad thing. Not only does buying a home give you pride in ownership, it also makes financial sense.