Article
Why Buy a Home
Deciding to buy a home is a big step in anyone’s life. For people who are first-time homebuyers in particular, the financial commitment of a mortgage can be daunting. There are several good reasons that everyone should consider before investing in a New York condominium. Aside from having a roof over your head, the ability to build equity is one of the most valuable aspects of home ownership.
Each monthly mortgage payment you make helps you to build equity and brings you closer to owning your New York condominium home outright. Home improvements that increase the value of your property may also add to your equity. Moreover, if property values in your area rise, your equity will too. Most large purchases like cars, boats or electronics go down in value as they age. Conversely, if maintained well a home usually increases in value over the years. In addition, if your New York condominium home’s value has increased substantially by the time you are ready to move, you may be able to profit from its higher resale price.
Once you build up equity in your home, you can benefit from a new avenue of borrowing through home equity loans and lines of credit as well as cash-out refinancing. Home equity loans are loans against the value of your New York condominium house and offered at a lower interest rate than conventional loans because, with the house as collateral, they represent a lower risk to the lender.
If you manage these credit sources wisely they can become a valuable source of income for major purchases such as a new car, vacation property, home renovations or emergency funds to use in the event of such things as a job loss or unforeseen medical expenses.
However, because for a home equity loan you have to give collateral of your house, it is important not to borrow more than you can comfortably afford to pay back. Otherwise, if you miss your payments, the lender could end up taking possession of your home.
Home ownership does require you to pay some extra fees such as property taxes and interest on your mortgage balance. Fortunately both of these expenses are usually tax deductible. Borrowing against your home’s equity may provide a tax break as well.
Home equity loans are usually tax deductible. In addition, if you have used your New York condominium house as a primary residence for two or more years, you can expect up to $250,000 in capital gains when you sell the property.
As a homeowner you can often exercise greater control over your housing costs than renters can. For example, you may choose to lower your monthly utility bills by reducing your energy consumption. This may not be possible as a renter if utility charges are included in your rental payment.
In addition, when you own your own home, you have more freedom to renovate as you choose without worrying about restrictions set out in a tenancy agreement and any upgrades you make may eventually pay off by increasing the resale value of your home. Finally, home ownership has plenty of non-financial benefits as well. When you own a home, it is yours; you can do what you want with it in terms of decorating, gardening or renovating. Remember, you not only own the house, but the land it sits on. There are few things as empowering as knowing that there is a piece of the world out there that belongs to you; a place you can truly call home.
- Go back
Sign up now to learn about new condo developments and investment opportunities.
