Buying your first home is an exciting endeavor. You can feel a sense of pride in knowing that the property belongs to you, and so long as you abide by zoning laws and potential HOA regulations, you’re free to remodel your home’s interior, exterior and yard however you’d like. But did you know that there are financial benefits to owning a home, as well? Below we have listed three great reasons you should buy a home in 2011.
1. Homeowners are eligible for many different tax deductions.
There are a multitude of tax deductions available to homeowners. For example, when it comes to monthly mortgage payments, most homeowners can deduct real estate taxes actually paid to the taxing authority, interest that qualifies as home mortgage interest and mortgage insurance premiums.
Although homeowners are required to pay property taxes, these, too, are tax deductible. HouseLogic.com lists a number of ways to become eligible for property tax breaks, including the installation of energy efficient appliances, having veteran’s status or using your property as your primary living space.
2. Owning a home is a fantastic investment opportunity.
In most cases, homebuyers aren’t just purchasing a place to live; they’re purchasing a property that can be sold for profit later down the road. Unlike renting, owning the property allows you to benefit from its increase in value, which is likely to happen over time.
Homeownership is especially advantageous in a market like Austin, where home prices generally appreciate at a steady rate. For example, the average Central Texas home purchased in 2004 appreciated 23 percent by the time it was sold six years later in 2010 (which is the average period of time Texan’s spend in one home).
3. The cost of buying a home can be lower than renting a home or apartment.
Sometimes, buying a home is more affordable than renting. One way to determine if this is true in your case is by calculating a home’s price-to-rent ratio. Some websites, such as Realtor.com, have created their own virtual price-to-rent calculators that will verify this ratio for you.
When calculating your price-to-rent ratio, keep in mind that changing markets can cause fluctuations in rental prices. And while rental rates can fluctuate, mortgage payments generally stay the same, depending on what type of loan you have. For Central Texans, economic experts predict that rental rates will steadily increase during 2011. “With increasing rent, renters will have to decide whether to keep paying rent or buy a home,” said Eldon Rude, director of the Austin market at Metrostudy.
These are just a few of the reasons why buying a home can be a smart choice. For more great reasons to become a home owner, speak with a REALTOR® by visiting our Find a REALTOR® section here at AustinHomeSearch.com.