Buying a home requires you to make some financial sacrifices so you can save up for a down payment and afford your monthly mortgage. In many cases, however, these sacrifices are worth it because homeownership brings significant advantages -provided you’re smart about the purchase you make.
Here are four huge benefits of owning your own place.
1. Homeownership helps you build wealth
According to the repcalgaryhomes, homeowners on average have a net worth that’s 80 times higher than that of renters. Some of this is because people who are in a better financial position tend to be more likely to buy a home. But owning a home, in and of itself, can help drastically improve your net worth.
Homeownership builds wealth for two reasons. As you make your mortgage payment you acquire equity in your home — and your home is an asset with value. When you pay it off over time, you end up owning it free and clear. That means you’ll own an asset worth hundreds of thousands of dollars in the end. Renters, on the other hand, never acquire ownership so they simply keep paying month after month without getting richer.
2. You’ll have more control over when you move
When your landlord owns your home, you’re always vulnerable to your lease not being renewed at the end of your loan term. Your landlord could also sell the property or decide to convert your units to condos or co-ops that you’d have to buy if you wanted to stay. Or, your landlord could be foreclosed on and lose the property. In any of these scenarios, you might be forced to move when you don’t want to.
If you own your own home, it’s far less likely you’ll be forced to leave it. While that could happen if you become unable to make payments, you have the ability to take steps to avoid that, such as saving up an emergency fund to cover the mortgage in case of a job loss.
3. Your housing payments should stay stable
In many parts of the country, there are few or no limits on how much your landlord can raise your rent. And rent increases are common over time, which means your housing costs could keep going up from year to year.
4. You can customize your own home
As a homeowner, you can do what you want with your property (as long as you don’t violate zoning laws or homeowners association rules). That means you can customize your house to suit your needs. Landlords generally have restrictions that prevent you from doing that — and even if they don’t, it wouldn’t make much sense to spend a lot of money improving the property you don’t own.
While this may not be the most important reason homeownership can benefit you — that would likely be the owner of the wealth-building power can have it may have a big impact on how much you’re able to enjoy your property on a daily basis.
A historic opportunity to potentially save thousands on your mortgage
Chances are, interest rates won’t stay put at multi-decade lows for much longer. That’s why taking action today is crucial, whether you’re wanting to refinance and cut your mortgage payment or you’re ready to pull the trigger on a new home purchase.