Monday, November 14, 2011

Five Great things about Homeownership

On the fence about purchasing a home vs. rentals?

Take a look at what's in store when you decide to take the "leap"

1. Equity.Equity.Equity:
We all know that when you pay rent into a place that at the end of the day, you're money is not invested. Granted, it is becoming more popular for some apartment complexes to add a equity rider into the lease however, not many do this. By renting, your basically lining the landlords pocket. Sure, homebuying comes with heavy cost up front (closing cost, downpayments) but if you look into the future of your home, you will easily earn that money back overtime with equity that's put into your home. Historically, homes appreciate by about 4 to 6 percent a year.

2. Relationships:
People who rent typically sign year leases while others sign more temporary leases anywhere between 3-9 months. Gernerallly, renters tend to see their neighbors come and go these days which in turn make it difficult to build relationships and socialize. On the flip side, homeowners tend to have yards, clubhouses or community spots where those of the community are able to meet, greet, and get to know each other. Typically, neighbors seem to stay in their homes at least 5 years to regain their closing cost. In turn, there is more time to develop relationships. On another positive note, recent research has proven that people with healthy relationships have more happiness and incredibly less stress.

3. Predictability:
As long as you have a fixed-rate term on your mortgage it's predictable. Most people buying homes today know that a fixed-rate is the way to go. This means your payment amount is fixed for the life of the term. If your mortgage payment is $500 today, then it will still be $500 a month in 10 years. This allows for people to budget and make solid financial plans. The sub-prime crisis meant many homeowners with adjustable rate mortgages saw their monthly payments rise and then rise some more. Homeownership, though, generally comes with a predictable table of expenditures. Even the big purchases are predictable. You know most roofs last just 15 years. You know that each year you'll need to pay for the gutters to be cleaned, and so on.

4. Ownership:
Homeownership means you "own" your home. And, this means you can renovate, update, paint, and decorate to your heart's desire. You can plant trees, install a pool, expand the patio, or almost anything you want to the home... that the HOA allows. The bottom line is this is your home and you can personalize it to your taste. Most renters are stuck with the beige carpet, stock cabinets and bland white walls.

5. Great Deals:
It's a great time to buy. Interest rates are at historic lows. We're talking 4.0 percent instead of 6.0 or higher and this means HUGE savings!!