You may see a lot of conflicting reports concerning the housing market and home prices. Some reports will tell you not to buy because prices will go down, while other reports will tell you to buy right now because prices will go up. It can be very confusing and daunting, especially if you’re a first-time homebuyer. Personally, I love helping renters transform into home owners and helping first-time buyers in their journey. There are so many great benefits to being a homeowner that include not just financial rewards but also psychological perks. If you’re on the fence if you’d rather keep renting or buy a home, here are some of my favorite benefits of becoming a home owner:
1. Equity
This is a big win for the financial benefits of buying a home. Equity is the market value of your home minus what you paid for it. Metro-wide, home prices have risen about 21% in the past year which means that anyone who owns a home has benefitted from those rising home prices. Home prices consistently rise on average which means that even in years when price increases are less extreme, homeowners are still likely to gain equity every year. This means that upon selling your home, or even applying for a second mortgage if needed, you’re likely to have made more money than what you first bought the home for and can make a profit.
2. Rent Prices
Not only are home prices increasing but rent prices are increasing exponentially. In the last year, rent prices have gone up about 27% on average leaving some renters tight on money and possibly having to move to a cheaper place. Rent prices have dramatically increased post-covid and unlike rising home prices, renters have no equity in paying rent. Homeowners who have bought a house also don’t have to worry about their monthly payments changing every year like renters do. Unless you have a variable interest rate mortgage, your monthly payment will be consistent through the life of your mortgage.
3. Generational Wealth
Assuming you decide to hang on to your home and not sell it ever, you have the ability to allow your family to inherit your home and keep the home in your family for generations. Through all those years your home will continue to gain equity and bring financial gain to your family. Many families opt to pass real estate to their children and grandchildren as an inheritance because real estate almost always sees profit and can even bring on better year over year growth than the average stock or bond gift.
4. Make it your own
Aside from multiple financial benefits, there are mental and psychological benefits of owning your own home too. For example, as a renter you may not be able to paint your child’s bedroom or make holes in the wall to hang a painting but when the walls of a home are yours you are free to do what you wish to them with no consequences. Something as simple as being able to paint a room can make a house feel like a home and you and your family can express yourselves as you see fit.
5. Planting some roots
Another benefit of becoming a homeowner is the idea of gaining stability and consistency. When you’re a renter you are at the whimsy of your landlord who may decide to sell or raise rent prices when they wish. When you are a homeowner, you don’t have to worry about moving every year or every few years and you can have some stability in knowing you can make friends with neighbors, keep going to your favorite coffee shop or not worry about changing your work commute. Planting some roots helps you build your life in the way you’ve always dreamed.
Do you have questions about buying a home as a first-time buyer? Are you in the market to buy or sell your home? Call and text me at (720) 323-4176 or email me at [email protected]
