The Best Reasons to Buy a House
Despite all of the gloom and doom that continues to fill media reports
regarding the housing market, there are still numerous excellent reasons for owning a home.
If you have found yourself on the fence wondering whether now is a good time to buy or
whether you should wait, be sure to consider the following reasons for buying now.
First, there has truly never been a better time to get a great deal on a
home. This is particularly true if you are willing to negotiate. Remember, it's still very
much a buyer's market. Since the tax credits have expired, a number of buyers have vanished
from the scene. Prices have declined significantly from the peak they reached a few years ago.
Of course, the big question of whether prices will continue to fall still remains. It's certainly
true that they might, but always keep in mind that it is impossible to catch the rock bottom of
In addition, mortgages are still extremely inexpensive. It's still possible to
get a 30 year mortgage loan for under 5%. Currently, there are some of the lowest interest rates
in the history of the mortgage business. Just a couple of years ago, rates were topping 6%. In
the event inflation should increase, you definitely will not see such low mortgage rates again.
On the other hand, if we should begin to experience deflation and interest rates fall even further,
you can always refinance your mortgage to take advantage of the lower rates.
There is also the fact that by buying a home, you can save on your taxes. Owning a
home gives you the advantage of being able to deduct mortgage interest from your annual income taxes.
You can also deduct real estate taxes. In addition, if you sell your home you will be able to gain a
break on capital gains taxes. Of course, these tax breaks are only available if you itemize your
deductions and in some cases homeowners might still be better off if they take the standard deduction,
so it's important to make sure you do your math. Even so, many homeowners find that such tax breaks
makes owning a home less expensive than renting.
You also cannot overlook the fact that when you buy a home, it's actually yours. You
can paint it whatever color you like or leave it as it is. When you rent, you will find that most
landlords are not so flexible.
By buying a home you will also be able to live in a much better home. In many different
areas of the country, it can be difficult to locate a decent rental. For the most part, if you want to
live in a better home in a nicer neighborhood, you will need to buy.
Buying a home will also provide you with some protection from inflation. Studies have
found that over the long term, housing often beats out inflation by as much as two percentage points
per year. If you're a young homebuyer, that can certainly provide some valuable insurance against
inflation over the course of the next thirty or so years.
There are also many different homes to choose from in the current market. Throughout
much of the country, there is actually a glut of houses for sale. According to the National Association
of Realtors, there are about 4 million homes for sale around the nation. Even more homes are continually
making their way onto the market as well, especially as an increasing number of banks continue to place
unsold foreclosures on the market. For buyers, this means great selection and great prices.
Homeownership also provides you with a type of forced savings. When you are renting a
home; that is money that is lost each and every month. Money you will never see again. When you own a
home, a portion of your mortgage payment goes directly to the principal payment as you build equity in
your home. Overall, its excellent discipline that helps you to save for the future.
Eventually, at some point, the market will rebound. Over the course of the next forty
years, estimates indicate the population will grow by more than a million. There might be a housing glut
at the moment, but it will work itself out sooner or later. Quite simply, there may never be a better
time to buy a house and take advantage of the numerous opportunities and options that are currently available.