• Home
    • About Us
    • Contact Us
    • Office Directory
  • Services
    • Business Brokerage >
      • Our Services
      • Selling Your Business >
        • Who Are The Buyers
        • What Can You Do
        • Seller Registration
      • Buying A Business >
        • The Business Buyer (You)
        • What To Look For
        • The Basic Steps To Buying
        • Buyer Registration
    • Commercial Real Estate >
      • Our Services
      • Selling Your Commercial Real Estate >
        • Commercial Sale Process
        • How We Find Buyers
      • Leasing Commercial Real Estate >
        • Selecting the Right Tenant
        • Types of Leases
        • How We Find Tenants
    • Residential Real Estate >
      • Buyers Information >
        • Buying a Home is a Good Idea
        • 7 Reasons to Own a Home
        • 7 Reasons to Work with a Realtor
        • Prepare for House Hunting
        • Buying a Home The Traditional Way
        • Buyers Aged 62 Years Special Information
      • Sellers Information >
        • Before You Sell
        • Through A Buyers Eyes
        • Things to Consider
  • International Real Estate
    • International Buyers
  • Information Videos
    • Palm Coast & Flagler Beach
    • Florida Attractions
  • Featured Listings
    • Single Family Homes
    • Vacant Land
    • Condominium
  Business-Commercial-Residential Brokerage
  • Home
    • About Us
    • Contact Us
    • Office Directory
  • Services
    • Business Brokerage >
      • Our Services
      • Selling Your Business >
        • Who Are The Buyers
        • What Can You Do
        • Seller Registration
      • Buying A Business >
        • The Business Buyer (You)
        • What To Look For
        • The Basic Steps To Buying
        • Buyer Registration
    • Commercial Real Estate >
      • Our Services
      • Selling Your Commercial Real Estate >
        • Commercial Sale Process
        • How We Find Buyers
      • Leasing Commercial Real Estate >
        • Selecting the Right Tenant
        • Types of Leases
        • How We Find Tenants
    • Residential Real Estate >
      • Buyers Information >
        • Buying a Home is a Good Idea
        • 7 Reasons to Own a Home
        • 7 Reasons to Work with a Realtor
        • Prepare for House Hunting
        • Buying a Home The Traditional Way
        • Buyers Aged 62 Years Special Information
      • Sellers Information >
        • Before You Sell
        • Through A Buyers Eyes
        • Things to Consider
  • International Real Estate
    • International Buyers
  • Information Videos
    • Palm Coast & Flagler Beach
    • Florida Attractions
  • Featured Listings
    • Single Family Homes
    • Vacant Land
    • Condominium
Picture

Why is Buying a Home is a Good Idea

As a fairly general rule, homes appreciate about four or five percent a year. Some years will be more, some less. The figure will vary from neighborhood to neighborhood, and region to region.

Five percent may not seem like that much at first. Stocks (at times) appreciate much more, and you could easily earn over the same return with a very safe investment in treasury bills or bonds.

But take a second look…Presumably, if you bought a $200,000 house, you did not pay cash for the home. You got a mortgage, too. Suppose you put as much as twenty percent down – that would be an investment of $40,000.

At an appreciation rate of 5% annually, a $200,000 home would increase in value $10,000 during the first year. That means you earned $10,000 with an investment of $40,000. Your annual "return on investment" would be a whopping twenty-five percent.

Of course, you are making mortgage payments and paying property taxes, along with a couple of other costs. However, since the interest on your mortgage and your property taxes are both tax deductible, the government is essentially subsidizing your home purchase.

Your rate of return when buying a home is higher than most any other investment you could make.

Income Tax Savings

Because of income tax deductions, the government is subsidizing your purchase of a home. All of the interest and property taxes you pay in a given year can be deducted from your gross income to reduce your taxable income.

For example, assume your initial loan balance is $150,000 with an interest rate of eight percent. During the first year you would pay $9969.27 in interest. If your first payment is January 1st, your taxable income would be almost $10,000 less – due to the IRS interest rate deduction.

Property taxes are deductible, too. Whatever property taxes you pay in a given year may also be deducted from your gross income, lowering your tax obligation.

Stable Monthly Housing Costs

When you rent a place to live, you can certainly expect your rent to increase each year – or even more often. If you get a fixed rate mortgage when you buy a home, you have the same monthly payment amount for thirty years. Even if you get an adjustable rate mortgage, your payment will stay within a certain range for the entire life of the mortgage – and interest rates aren’t as volatile now as they were in the late seventies and early eighties.

Imagine how much rent might be ten, fifteen, or even thirty years from now? Which makes more sense?

Freedom & Individualism

When you rent, you are normally limited on what you can do to improve your home. You have to get permission to make certain types of improvements. Nor does it make sense to spend thousand of dollars painting, putting in carpet, tile or window coverings when the main person who benefits is the landlord and not you.

Since your landlord wants to keep his expenses to a minimum, he or she will probably not be spending much to improve the place, either.

When you own a home, however, you can do pretty much whatever you want. You get the benefits of any improvements you make, plus you get to live in an environment you have created, not some faceless landlord.
Picture

386-603-4600

Terms of Use

Privacy Policy

Copyright © 2015
  • Home
    • About Us
    • Contact Us
    • Office Directory
  • Services
    • Business Brokerage >
      • Our Services
      • Selling Your Business >
        • Who Are The Buyers
        • What Can You Do
        • Seller Registration
      • Buying A Business >
        • The Business Buyer (You)
        • What To Look For
        • The Basic Steps To Buying
        • Buyer Registration
    • Commercial Real Estate >
      • Our Services
      • Selling Your Commercial Real Estate >
        • Commercial Sale Process
        • How We Find Buyers
      • Leasing Commercial Real Estate >
        • Selecting the Right Tenant
        • Types of Leases
        • How We Find Tenants
    • Residential Real Estate >
      • Buyers Information >
        • Buying a Home is a Good Idea
        • 7 Reasons to Own a Home
        • 7 Reasons to Work with a Realtor
        • Prepare for House Hunting
        • Buying a Home The Traditional Way
        • Buyers Aged 62 Years Special Information
      • Sellers Information >
        • Before You Sell
        • Through A Buyers Eyes
        • Things to Consider
  • International Real Estate
    • International Buyers
  • Information Videos
    • Palm Coast & Flagler Beach
    • Florida Attractions
  • Featured Listings
    • Single Family Homes
    • Vacant Land
    • Condominium