Owning your own home offers a number of benefits over renting a house or apartment, and is a long-term goal for many people. While the initial cost of owning a home may be high, this cost is accompanied by some major advantages, both financial and personal.
Pride of Ownership – One of the largest benefits of owning your own home is the pride you will feel about owning. Unlike renting, your monthly payments will go not to a landlord, but towards the ultimate ownership of your home.
Retirement Savings – Long term home ownership provides financial security for retirement through the growth of equity, and the ability to live rent-free once you own your home free and clear.
Appreciation – Historically, the average value of homes appreciates yearly, meaning your home’s value increase with each passing year. This is an advantage if you ever decide to move, as you can sell your home for a profit.
Stability – Rental rates fluctuate far more often than mortgage interest rates, which make owning your home a more secure option in terms of future pricing.
Tax Deductions – As long as your mortgage balance is smaller than the selling price of your home, the interest payments you make are entirely tax deductible. This is a major tax advantage for homeowners that renters do not receive.
Property Tax Deductions – Any taxes you pay on your property can be written off as a tax deduction.
Tax-free Profit – In the event you sell your home, you do not have to pay any taxes on the profit that you make, up to the federal limit. The current capital gains laws allow you to exclude up to $250,000 in home-sale profit from your taxable income ($500,000 if you file jointly).