Should I buy a home?
The home buying process begins with the decision to buy a home. You may be just starting out, tired of renting or buying your third home, the reasons to buy a home are varied. Just remember that owning a home is added responsibility that will demand some of your time, energy and money.
Buying a home can be a good investment if you take care of the property and constantly make improvements. Otherwise, you may not be getting the most out of your money.
Beyond simply fulfilling the desire to own your own home, there are some financial perks involved with being a homeowner.
- Income tax reductions. Interest paid on a mortgage loan and property taxes can often be deducted from your taxable income. With the tax break, it is sometimes less expensive to own a home than to rent.
- Buying for profit. Real Estate can be a good long term investment. Several factors play into the appreciation or depreciation of a home, but if the market is good and you have maintained your house well, you could sell your property for a profit.
- Equity. As the balance on your mortgage goes down, your equity goes up. You can use the equity in your home to secure different kinds of loans that you can use to finance whatever you choose. Often, the interest paid to a loan secured by equity in your home can be deducted from your income taxes.
For many people, the decision to buy a home starts simply with the notion of homeownership. You want your own place. You want to paint your walls the color you want and plant your own garden.
These are some good reasons to buy a home. As you consider the perks, don't forget about the increased responsibility of owning your own home. Depending on its age and condition, just about every home will demand some amount of your time, energy and money to maintain.
How well you maintain your home and property could have important financial impact down the road. Care for your property, keep your home well maintained - even make improvements - and your home could increase in value. Don't do these things and you may not be making the most of your investment.
Important Note: For more complete information about the tax implications related to home ownership, you should consult a tax advisor.
When to buy
When deciding to buy, it is a good idea to look at the real estate market and current interest rates. The more people buying homes at the same time you are, the higher the prices. Competition from other prospective buyers pushes the price of property up. Make sure to take into consideration that the higher the market prices are the further they have to fall later. If you only plan on staying in your house for a few years, you will need to pay close attention to the condition of the market when you buy.
However, the condition of the market is not the sole factor you should consider in buying your home. Just because the market is booming does not mean that you should not buy. You will need to look at your reasons for buying. Perhaps you have found your dream home and you cannot give up this golden opportunity. You can look at the different types of loans that are offered to help make the house more affordable. Loans come with different terms, rates and requirements to help you buy that dream home even in a tough market.
Mortgages at Simmons Bank
There's a lot to know when it comes to buying a home. That's why we offer free resources, such as calculators and home-buying guides, to make sure you're equipped with the knowledge you need.
Buying a home
- Should I buy a home?
- Affording a home
- Your loan options
- Pre qualifications
- Buying the house
- Affording your home
Refinancing a home
Using home equity