Some Great Benefits to Owning Your Own Home
The year 2004 provided a stunning example of a prime reason it's wise to own your own home. Homes increased in value a median of 9.4%. Many found that they earned many thousands of dollars simply by moving into their newly built home. An average year sees an increase of more like 5%, in some years values even lose ground, but all told, owning your own home is by far the best investment most average folks will ever make. For many baby boomers, with the waning of pensions and the difficulties in contributing to IRA account, the only security they will have in their retirement years will be found in the appreciation of their homes
Another great benefit can be found in the form of tax benefits. Especially in the early years of a mortgage, most of what you pay monthly is in the form of interest, which is tax-deductible This means that, if you go from renting to owning, and your rent is roughly equivalent to your mortgage payment, come tax refund time it's going to feel like Uncle Sam is paying for your housing. Nearly all the money you will have to spend on housing will be deductible on your taxes!
But beyond these practical, financial incentives there are many intangibles. There is for most people an intense pride in home ownership, and there is a sense of freedom at being able to modify your home environment to suit your own tastes and needs. There's the feeling of belonging to a community that is suddenly stirred when your name is on the deed of your home. Your kids will perhaps feel more secure and confident that they're making friends that will last throughout their childhoods. You may find yourself volunteering for community activities you never felt connected to before. When you become a homeowner you put down psychological roots that can mean a lot.
Another trend in homeownership is the phenomenon of 'house flipping.' It's become a sort of hobby for many to buy a home, do renovations calculated to appreciate well, then sell in a few years to pocket a handsome profit. It's said that if this is done four times over a ten to twelve year period, with each house being more expensive than the last, enough money can be made to pay for a final home in full.