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Is Buying a Home Still a Smart Plan?

With the burst of the housing bubble, credit crisis, and millions of foreclosures across the country, you may wonder if buying a home is such a good idea after all. However, it’s important to consider all of the facts. The important message to take away from these events is not that buying a home is a bad idea, but that you must be smart about buying your home.

The housing market, like every type of market, unavoidably has its ups and downs. That doesn’t mean buying a home is a bad investment. As a long-term investment, homeownership is still one of the best investments for individual households. Historically, real estate has consistently increased in value, despite shorter periods of depreciation due to local markets and/or national economic conditions. The data shows that homes generally appreciate about 5% per year.

Savings & Investment

Five percent may not seem like a great return on investment, but you have to think about it in the context of the situation. For example, let’s say you put 10% down on a $200,000 house. That’s a $20,000 down payment, or initial investment. At a 5% annual appreciation rate, your $200,000 home would gain $10,000 in value during the first year. Earning $10,000 on an investment of $20,000 is a whopping 50% return.

For further perspective, let’s say instead of spending that $20,000 on a down payment, you invested it in the stock market. With a 5% return, you would gain only $1,000 in profit.

Tax Benefits

So now you’re saying that a home may have a higher return, but that’s before you consider all of the costs of home ownership, such as taxes, etc. Well, think of it this way: your property taxes as well as the interest on your mortgage are both tax deductible. You can deduct those costs from your income, thus reducing your overall taxable income. In other words, the government is subsidizing your home.

Other Benefits

It’s easy to get carried away with all of the economic reasons for home ownership, but it’s important to remember that not every reason is financial. Have you ever wanted to paint the walls of your apartment? Well when you’re renting, you can’t. Has anything in your apartment ever needed updating, but the landlord refused to do it? When you own a home, you can make the space yours in almost any way you want. And you benefit when you do home improvements, both financially and psychologically. Homes generally have more space, for storage, living, etc. than other living arrangements. Not to mention that you have space outdoors for barbecuing, pets, and kids. Owning your home carries with it a sense of pride, accomplishment, and even an elevated social status.

So when you’re considering buying a home, consider the broad range of benefits that owning a home can have. And always make sure you have an experienced real estate agent and loan officer to help make sure you’re getting a home that is right for you, both financially and psychologically.

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Faye Hunter, Broker
Century 21, The Hunter Group

114 South Main Street
Statesboro, GA 30458-1475
Phone: 912-489-5750
Email: fayehunter@realtor.com

Testimonials Page

I was very pleased with Jessica in every way. After our first meeting she started right away with selling my mom's house. I didn't have to worry about one thing. Jessica is an excellent agent. She is very personable but professional. I live out-of-state but she kept me well informed. She has a great personality. Jessica showed that she has morals and values which are valuable traits to me. I would definitely recommend her to anyone. The sale was very quick. You are very fortunate to have Jessica working for you. The process from beginning to end went very smoothly. Thanks to Jessica. Vicky Click,Southport, NC April 27, 2018
When you have a very patient friend who is also your real estate agent, you are doubly blessed! This entire process of prepping to sell and selling Mom's house was made much easier thanks to your guidance and patience - again, the "p" word. From letting me know what to expect, to determining what "fair" means, and all the other minute in between. I relied on your experience and advice. You did not once let me down. Thanks for not only being the trusted consummate professional, but for being a great family friend. Best always, Marianna Marianna Voiselle, February 6, 2018
Thanks for all your help in making our "dream home" a reality. We really appreciated that you went the extra mile to get us the best price for our home. You are truly a professional.
In all our dealings with Realtors over the past ten years, we have never met anyone as helpful and energetic as you have been. Without hesitation, we would highly recommend your service to anyone who is looking for an experienced Realtor who cares about getting things done and doing them right! Thanks for taking such good care of us, we couldn't have done it without you!
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