With tax day quickly approaching, it makes sense to take a look at how home ownership makes “cents”!

1.       Homeownership builds wealth over time.

The number one rule of course is to buy a home you can actually afford!

2.       Homeowners build equity every month.

Simply put, the amount you can sell your home for - the amount you owe= Equity. 

When you make a mortgage payment the amount you owe on your home goes down. Thus, as the years go by, your equity grows.

3.       Multiple Mortgage Tax benefits.

At tax time your benefits include: mortgage deduction, closing cost deductions (1st year) and property tax deduction.

4.        Home Equity line benefits.

Shift your higher interest rate debt to a lower interest rate home equity loan PLUS get a deduction on the interest as well.

5.       Homeowners get Capital Gains Exclusions.

After two years you can keep the profits up to $250,000 (single) or $500,000 (married).

This can be relevant in today’s rapidly appreciating market.

6.        A Mortgage is like a forced savings plan.

Paying your mortgage every month and reducing the amount of your principal is like a forced savings plan. Each month you are building up more valuable equity in your home.

 

7.       Buying makes more financial sense than renting.

In the first few years, it may be cheaper to rent. But over time, as the interest portion of your mortgage payment decreases, the interest that you pay will eventually be lower than the rent you would have been paying. Why pay off your landlord’s property when you can pay off your own?!

Are you on the fence about whether to purchase a new home in the Boise, Idaho area? Consider these important factors..............
Interest rates directly affect the price of the home a buyer can afford.  With interest rates continuing to hold at all time lows, and the predictions of higher rates in 2014 looming, now may be the perfect time to jump off the fence and take advantage of this increased buying power.
How significant is the buying power of lower rates?       Take the example of a buyer qualified to purchase a home for $200,000 at 4.5%. If the interest rate increases to 5%, the same buyer only qualifies for approximately $188,000. When rates jump to 5.5%, the buying power drops to approximately $178,000.  The difference is much more significant than most people think!
With interest rates over the last 30 years averaging close to 9%, and rates as of October 30th, 2013 at 4.125%, why wait?  NOW is the time to make your move!!!!