There has never been a better time to make the transition from renting to buying. It is a big step, and it can be a scary transition for many - especially first time home buyers. However, once you make the leap from "Home Renter" to "Real Estate Aficionado" you will be glad you did.
If you need a little extra inspiration to take that next big step towards home ownership, here are a few exciting facts to help light your fire:
5 Reasons to Make the Transition from Renter to Buyer
- The Infamous Tax Write-Off. When it comes to tax time, there are two major write-offs: kids and real estate. Whether or not you have the former, the latter will help you increase your refund at tax time, or help you to pay a little less. An added bonus to home ownership is that your house won't keep you up at night, it will never steal the keys to the car, and a new roof every 10 - 15 years is still significantly more affordable than 4 - 8 years of university tuition. You can (usually) deduct the following items:
- The interest you paid on your mortgage (you cannot write off any money paid towards your principal loan amount)
- Property taxes
- If you purchased a home this year you can probably write off the any sales taxes and/or settlement fees
- The Super Low Interest Rates. There is no denying that these past four to five years haven't been the best: foreclosure rates, job reports, budget cuts, and the list goes on. They say that every cloud has as silver lining and one recent silver lining is current interest rates. In an effort to help our economy recover, and boost real estate sales, the Feds have continued to keep interest rates down. This is great news for home buyers who are ready to take the plunge. Secure a mortgage payment with a low fixed-interest rate and you will have a low reliable monthly mortgage to add to your budget.
- Median Home Prices are Low. For many renters, especially those in high dollar areas, paying rent can be more expensive than acquiring a mortgage. All those home foreclosures meant a flooded rental market. A flooded market means inflated rental prices. And that means there has never been a better time to buy. Why throw rent money down the drain when you can be making equal (or even lower) monthly payments for something you own...and can write off on your taxes? (Please see #1)
- Equity Is Possible Again. Buying a home when prices are low means you have a much better chance of building equity. Hurray! Equity is important for anyone who has a stable financial plan and is looking forward to a healthy retirement. Once real estate prices begin to inflate again, you don't want to be watching all of that "could-have-been" equity pass you by. You want to be sitting comfortably on the inside of the equity train.
- New Home Builders are Offering Killer Discounts. Things were shaky for a while in the new home sector. Now that the new residential construction is bouncing back, it's a buyer's market. Not only will you be able to take advantage of builder discounts, you will probably have more bargaining room to negotiate a price you feel comfortable with. An added incentive - new homes equal long-term savings due to stricter energy efficient building codes.
The time for you to transition from Renter to Owner might just be now! If you're ready to make the jump into home-ownership, consider Pacific Place in Redwood City!