Home Ownership Part 2

“SAVINGS”

When an individual first purchases a home the mortgage payment includes both interest and principle payments. In the beginning the borrower is paying mostly interest but as time passes the majority of the payment goes on the principle. This is where the saving part comes in at because by this time your payment will be mostly principle and that payment will be less than a rent payment, since market rent continue to increase.

 “LEVERAGE”

A home owner has a leverage position when buying a home. It is purchased with a small percentage down but appreciates based upon the total purchase price. Plus, when an individual owns a home, there is additional buying power because they can, although not recommended, go out and get a home equity loan.

 “FREEDOM”

A person that rents a home needs to ask the landlord or permission every time they want to paint or plant a garden or put up a swimming pool. Whereas, a homeowner does not need to ask for permission, unless they live in a hoa. They can paint their walls any color they desire and have their entire yard as garden if they wish. A homeowner has the freedom that a renter does not have when they own their home.

 “STABILITY”

The homeowner has the same payment month after month, year after year, as long as they have a fixed rate mortgage. This gives the homeowner a sense of stability. They know what to expect every month. Whereas a renter, may not know what to expect from month to month. Every year the cost of living continues to go up and that means the cost of rent as well. So, by owning a home the individual has a good feeling knowing their payment is not going to change regardless of how much the cost of living goes up.

 “Finally . . . PRIDE”

There is nothing like the feeling you get when you own your home. It is your home. You worked hard to get it and now you can feel good that you have made a great accomplishment.

 

Tim Brodowski, MBA, CNE, GRI, BPOR, CIEA, MilRes Spec
Call/Text 858-354-2354
Email TimBro97@aol.com
www.TimBroHomes.us
BRE #01224576

Home Ownership Part 1 of 2

Studies on home ownership indicate there are many benefits to home ownership over renting a home. Ownership benefits are not limited to single family homes, but also include condos, townhomes, and single family homes. Some of the benefits are: security, investment, tax advantage, savings, leverage, freedom, stability and pride.

Interesting stuff … So, let’s take a closer look at these advantages.

 “SECURITY – SAFETY NET”

 In the event that inflation runs wild, the homeowner has a safety net to help protect themselves from being left out in the street since the homeowner is the only one who holds the keys to the home.

 “INVESTMENT”

 The individual that buys a home is really buying a long term investment. Each monthly payment increases the amount of equity the home offers the owner. Every time a homeowner makes a home improvement, that improvement may increase the value of the home. If the individual was just making monthly rent payments then there is nothing to show for the money paid out each month.

 “TAX ADVANTAGE”

 Every year tax time rolls around … we can use all the help we can get when it comes to reducing taxes. Home ownership is a way to reduce your tax exposure. The homeowner can deduct the real estate property tax and the interest on the mortgage. Plus, if you operate a home office there may be another way to take some deductions. You can’t do this when you are renting.

 

Tim Brodowski, MBA, CNE, GRI, BPOR, CIEA, MilRes Spec
Call/Text 858-354-2354
Email TimBro97@aol.com
www.TimBroHomes.us
BRE #01224576