Owning a home provides you with more than privacy and independence. It can also be a wise financial move that helps you save money and potentially make an impressive profit. Purchasing a home comes with these fantastic monetary benefits.
One of the biggest financial benefits of owning a home is that it lets you build equity. When you rent, you essentially just give a large amount of your paycheck away each month without any permanent reward. Paying a mortgage is different because the money you spend goes toward real property. In addition to getting a place to live, you build valuable financial equity with each mortgage payment.
Add Property to Your Investment Portfolio
Real estate can also be a form of investment. Unlike other purchases, such as vehicles, it’s fairly common for the value of real estate to rise over time. If you buy a home in a market with a high growth forecast, you could end up making a hefty profit when you decide to sell. This is especially true for hot properties such as downtown San Diego lofts and condos, but just about any property can increase in value if you hold on to it long enough.
Protect Yourself from Rising Costs
A common reason people buy homes is they’re tired of their landlords increasing their rents every year. If you’re in an area with limited housing, you may find rental prices rising at a much faster pace than interest rates. Whether you choose an adjustable rate mortgage or a fixed rate mortgage at a low price, in a few years, you may find your mortgage payment is significantly lower than what your peers are paying to rent.
Supplement Your Income
Buying a home comes with the advantage of finally being able to do what you want with your property instead of being bound by a strict lease that won’t let you do things such as having guests stay for a week. If you choose to, you may be able to make a little extra money by renting out a room or running a business from your home, which lets you supplement your income and offset the costs of home ownership.
Receive Tax Benefits
There are all sorts of tax deductions that only homeowners are eligible for. You can deduct the interest you pay on home equity lines of credit, and the tax code also lets you deduct mortgage interest from your taxes. In the first year of home ownership, tax deductions are particularly large, with the ability to deduct loan origination fees. Furthermore, any real estate property tax you pay can be deducted from your income tax.
Buying a home can be one of the smartest financial moves you’ll ever make. It’s also a shrewd move to work with realtors who have years of experience with buying and selling downtown San Diego real estate. Trust the experts at 92101 Urban Living to help you find your dream downtown San Diego condo, loft, or penthouse. We’ll work with you throughout the home-buying process. Call one of our friendly agents today at 619-649-0368.