The Benefits of Homeownership: Part II

English Real Estate Group Video Blog with Scott English

Buying a home comes with a lot of financial benefits. Today, we're discussing a few more of these benefits.

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We're back to discuss the second portion of our series on the many benefits of homeownership.

Click here to read the first portion of our series.

1. Tax deductions on home equity lines and mortgage interest can allow you to shift your credit card debts to your home equity loan to pay a lower interest rate and also get a tax deduction on the interest.
2. You get a capital gains exclusion. If you get a home and live in it as your primary residence for more than two years, you'll qualify. When you sell the house, you can keep the profits up to $250,000 if you're single or up to $500,000 if you're married without owing any capital gains taxes. It may sound ridiculous that your house might be worth more when you sell it than when you buy it after these several years of falling housing prices, but if you bought your home prior to 2003, chances are it has appreciated in value. In that case, the tax savings will come in handy.
3. A mortgage is like a forced savings plan. Each month, you build up more valuable equity in your home and are being forced to save, and that's a good thing. In the long term, buying a home is actually cheaper 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 you pay will eventually be lower than the rent you'd pay. More importantly, you won't be throwing away all your money on rent. You have to live somewhere, so instead of paying off your landlord's mortgage, why not pay off your own?

If you're thinking about buying a home or you have any questions I can answer, feel free to give me a call or send me an email. I'd be happy to help you.