You want your own place. You want to paint your walls the color you want and plant your own garden.
As you think about the reasons to own a home, also think about the increased responsibility. Almost every home will demand time, energy and money to maintain — no landlord to fix the leaky faucet.
Financial reasons for buying
Reducing income taxes.1 With a mortgage, you may be able to deduct the interest you're paying — and property taxes — from your taxable income. In some cases, owning is less expensive than renting.
Buying for profit. While there are no guarantees that your home will appreciate in value, it's true that real estate can be a good investment over the long haul.
Building equity. As you pay down a mortgage, you build equity, or value, in your home. You can use that value to secure a home equity loan or line of credit.
Timing your purchase
The mood of the real estate market and the direction interest rates are moving may encourage you to jump in or cause you to put off buying right away.
Buying when the real estate market is hot generally means prices will be higher.
You'll face increased competition from other buyers who may be willing to offer more than the asking price.
You may be vulnerable to future price downswings, particularly if you don't plan to stay in your home for more than a few years.
|1Consult your tax advisor and IRS Publication 936 (Home Mortgage Interest Deduction) regarding interest deductibility.