Which one is the best financial asset in this digital era?
Deciding to buy a house is a big decision as it will probably be the largest physical asset you will ever own.
The advantage of home ownership is not just in the property itself but because it requires financial responsibility.
Saving for a down payment takes time, and you need to qualify for a mortgage.
You have to consider all the costs involved, from property taxes to insurance.
The financial advantages of owning a house include appreciation, tax deductions, and home equity.
5 Reasons Why Owning a House is Your Best Financial Asset
Here are 5 Reasons Why Owning a House is Your Best Financial Asset
Buying a house can not only provide you with a good return on your investment, but you have a place of your own in which to live.
When you buy your home, you will need to consider factors such as location and neighborhood.
Where the home is located will factor into the appreciation of the property.
Today more people are working remotely and need a private and comfortable home office.
You should consider this when buying a home if you work remotely.
Owning your own home means that you can renovate it without having to get permission from a landlord.
You can paint the house and customize and decorate it to suit your own tastes.
If you rent a property, the landlord controls what conditions you have to meet in the lease agreement.
So if you want to ensure that you get maximum rent from verified tenants and that your property is maintained to the highest standard, you should hire a property manager.
For example, If you’re interested in the Colorado area, there are a lot of reliable property management companies in Denver, Boulder, Fort Collins etc.
You can get the maximum rent and keep your property in great shape, along with the peace of mind.
Anticipate monthly costs: Having a fixed mortgage means you know what you need to pay for your home on a monthly basis for the next 20 or 30 years.
If you rent, a landlord can decide to raise the rent higher than you can afford to pay or sell the house when your lease agreement expires.
Build equity: As you build equity, your home value increases.
This gives you various options, such as refinancing to have the money to send a child to college.
Improve credit: As you make regular, timely payments on your mortgage, your credit score increases over time.
If you tend to be a spender, buying a house can force you to save.
Your house can act rather like a long-term piggy bank.
Rather than burning through your money, you direct it towards an asset that appreciates over time.
By financing your home purchase with a mortgage, you continuously save for the future by making a mortgage payment every month.
It is much better than spending all your money on assets that depreciate over time, such as cars or recreational equipment.
If you manage to pay off your mortgage before you retire, you have a huge advantage over people who rent their whole lives.
You can enjoy retiring with the knowledge that your monthly expenses will be much lower due to not having to pay off a mortgage.
Of course, you will still have to pay property taxes and do maintenance.
Having equity is a great advantage.
You can leverage your home as an asset in various ways, such as renting out a room or downsizing to a smaller home that costs much less.
It can be difficult to break even on a house if you stay in it for three years or less.
The closing costs and commissions are high.
Expecting the house to appreciate enough in value to make up for these costs is probably setting your expectations too high.
Constantly selling and buying houses may consume profit rather than increase it.
Living in your own house for a long time has many advantages, including the fact that you can develop strong community ties.
Human beings need a sense of belonging, and being part of a community can provide that.
Communities where residents are settled in over a long time often have stronger social ties and more civic engagement.
If one of your reasons for buying a house is to pass it down to your children, you will probably find you are not alone.
Your neighbors may feel exactly the same way, and together you can create a stable, attractive neighborhood.
Buying a home can be a great investment, depending on a few factors it can benefit you as the best financial asset.
It comes with benefits and risks, which you need to weigh up.
Your house will appreciate in value over the years.
If you can sell at the right time, this ensures that you will get a good return on your investment.