Buying a home may be the American dream, but it’s also a monumental task: You have to clean up your credit, apply for a mortgage, scrape together a down payment, and then move all your worldly possessions in after you close on the deal. Phew! So then why do millions of Americans go through the trouble? Because they know that whatever headaches and hassles they must endure are far and away outweighed by the many benefits of buying a home has to offer, check out this top 10 list of perks that will repay your hard work from now well into retirement.
Predictable monthly housing payments
A landlord can raise your rent whenever a lease expires—and often by as much as he pleases. But as a homeowner, you can lock in a predictable mortgage payment for as long as 30 years. Bonus: Your housing budget goes toward your homeownership, not your landlord’s.
Owning a home will provide you with a valuable asset and financial stability. By purchasing a home, you’ll have an asset that, in many cases, will appreciate in value over time. A $400,000 home today should see an increase in value to $450,000, $500,000, or more. This makes your home one of the best investments you can make and a way to establish a financial foundation for future generations (aka your kids).
The many expenses of owning a home—like property taxes and accounting costs—are tax-deductible. The largest deduction is generally the interest you pay on your mortgage. This allows you to keep more of your hard-earned money.
Freedom to make modifications
What renter hasn’t thought “I’d really love to paint/alter/knock down this wall to…”? Well, to do whatever the hell you want to do. But, of course, you can’t—not without the landlord’s blessing. And if you are allowed to renovate your rental, it’s the landlord who will ultimately benefit. (Especially if you do a really awesome job at it.) Homeowners, on the other hand, don’t need permission. They can paint any room any color, replace the cabinets, add a deck, or do any other modifications they wish.
Sure, there’s the upfront cost of the down payment and closing.
After that initial down payment, the monthly expense of owning a home is much less than paying rent in the majority of markets in the U.S. According to ReatlyTrac, buying is the more affordable choice in 58% of U.S. markets (figure out costs in your area with the Rent Vs. Buy Calculator). Plus, mortgage rates are currently low, making it an economically wise choice to purchase a home sooner than later.
Some rentals are constructed of inferior building materials like plywood or shoddy drywall. If your house, townhouse, or condo is built of concrete and stucco, it will provide a greater sound barrier from your neighbors.
Built-in rainy day fund
Homeownership provides you with the opportunity to borrow money on the equity you eventually build up by consistently paying your mortgage. Securing a home equity loan at a relatively low interest rate will condition you to get financing for an emergency, large project, or other expense.
Owning a house you plan to stay in for a while also allows you to have an impact on your community with your taxes benefiting local infrastructure, schools, and organizations. You’ll also have a voice—if you wish—in how things are run in your area.
A secure retirement
A home can be the ultimate nest egg, providing you with a great investment for retirement. The longer you own a house, the more it should eventually be worth. If you plan on staying in a home for 30 years, it’s most likely it’ll appreciate 100%. As you get older, you can sell the home and use the proceeds to purchase or rent something smaller. Another option: Rent out the house to maintain a steady income stream so you can travel or use for other recreational activities.
This may seem fairly obvious, but it’s worth emphasizing: With a rental, you run the risk of getting kicked out at the end of your lease. With a home, you can live there indefinitely. And isn’t there something comforting in knowing there’s a place where you’ll always have a roof over your head?