Five Reasons Why You Should and Shouldn’t Become A Home Owner
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Five Reasons Why You Should and Shouldn’t Become A Home Owner
Like most prospective first time home buyers you probably have friends and family encouraging you to take the leap. However, while there are many good reasons to buy a house, becoming a home owner is not right for everyone. This article will list five reasons why you should buy a home and five reasons why you shouldn’t buy a home just yet.
Why you should buy a home:
1. It’s the American dream: Owning a home with a white picket fence is the American dream. There is a lot of pride that comes with owning your own home.
2. No landlord: Owning your own house means that you can do whatever you want to it (within reason). You can paint the walls any color you want, you can make renovations, and you can install that new flat screen TV on your living room wall without having to ask permission.
3. Equity: Every time you make a mortgage payment you are building equity in your house (see my article on interest only mortgages for the exception to the rule). Your house is going to be your most valuable asset very quickly.
4. Tax deductions: The tax law allows home owners to write off interest paid on their mortgage along with many other deductions. If you are a first time home buyer you can probably find even more tax deductions.
5. Rising housing market: Your home is an investment, and just like any other investment timing is everything. If you are able to purchase a home at the right time it could be the best investment you’ll ever make.
Why you shouldn't buy a home:
1. Job security: If you sign a 30 year mortgage and then lose your job, it’s not as easy to get out of as a rent agreement. Same goes for if your company decides to transfer you out of state.
2. Tend to move a lot: If you tend to move a lot and can’t see yourself in one place for a long time. Buying a house is a long term commitment. Even if you don’t stay in your home for the full length of the mortgage, plan on being there at least 10 years in most cases.
3. No landlord: Not having a landlord means having more freedom. It also means that you have to take care of any repairs and maintenance that your home needs.
4. Additional costs: Owning a house is expensive. On top of the mortgage you have to pay for bills, property taxes, repairs, and a whole laundry list of items first time home buyers often don’t think about.
5. Falling housing market: If you purchase a house and the market falls, any equity that you may have built up in your home could be gone just like that.
Hopefully this article was more helpful than confusing. Buying a house is a big deal and there are a lot of things that need to be considered. What is right for one person may not be right for the next. The only person who can make the right the decision about becoming a homeowner is you.
For information about mortgages check out my other articles:
