Is It Good Time To Buy A Home?

If you’re strictly looking at home prices and interest rates, now isn’t the time to buy a home. Home prices were driven up by limited inventory and high demand during the pandemic. Additionally, mortgage interest rates have increased, meaning not only will you pay more for your home, but you’ll pay even more over the life of your mortgage.

Buying a home currently costs significantly more than it did before the pandemic, but that doesn’t necessarily mean that buying a home isn’t worth the cost. Instead, you’ll need to decide if buying a home is right for your financial circumstances and goals. To do that, it’s important to consider the many ways that a home may be a valuable addition to your life.

Appreciation and Equity

Your home appreciation, or the rate at which the value of your home increases over time, will change over the years. In times when the housing market is hot, your home’s value can increase. In addition to the natural appreciation that occurs because of the housing market and economy, you can also increase your home’s value with upgrades like renovations and expansions or installing energy-efficient enhancements, like solar panels.

As your home’s value increases, your home equity grows, too. Your equity, which is the portion of your home that you own, is the difference between your home’s value and the amount of money that you still owe on your home. That equity can be valuable if you want to buy another home, but you can also access it for other purposes through options like a home equity line of credit or a home equity loan.

Tax Benefits

Homeowners may qualify for several tax breaks. You may be able to deduct your mortgage and/or home equity loan interest from your taxes. Property taxes, home office expenses, private mortgage insurance, and home improvement costs may also qualify for tax deductions.

Security

When you own your home, you have the security of knowing that a landlord won’t decide to sell your apartment or increase your rates. Knowing that you have a stable living environment can be a tremendous value, especially given the climbing rental prices and how challenging it can be to find affordable housing.

Freedom

Homeownership also gives you freedom. You have the ability to renovate your home, paint the walls, or even rent out a room or floor of the building if you need extra income. You can have pets of your choosing without worrying about getting permission or paying a pet deposit.

There’s no question that buying a home is a major financial decision, especially now. However, homeownership comes with many benefits, and you might decide that it’s worth the price.