FOUR PRINCIPLES THAT EVERYBODY SHOULD KNOW ABOUT REAL ESTATE

By: Tina Parker

FOUR PRINCIPLES THAT EVERYBODY SHOULD KNOW ABOUT REAL ESTATE

Tags: HOMES IN HALIFAX, HOUSE SELLING, SELLING A HOUSE, REAL ESTATE IN HALIFAX, TINA P

There are several benefits of investing in real estate. Investors can enjoy predictable cash flow, tax advantages, and the possibility to leverage real estate to build wealth.
Homeownership can help individuals to create an asset to invest in and accumulate their wealth. It seems that one of the great investments nowadays is taking out a mortgage and investing in property-owning a home. It is considered a wise decision because instead of paying rent, homeowners can pay off their debts, and accumulate wealth and a home to live in.
Planning and thinking about investing in real estate? Here are the principles that you should know about real estate and why real estate is considered a good investment.      
 

  1. A DUAL-PURPOSE INVESTMENT
“A HOME IS BOTH A CURRENT NEED AND AN INVESTMENT INTO YOUR FUTURE”
 
Home is essential as it provides security and privacy. It is a place where we can rest, relax, and enjoy time with family and friends. It is our sanctuary where we can stay at peace. Most of us have similar goals why we dream of getting our own home, no matter what size, shape, color, or type of home we choose in a specific place.  We are all planning and wanting to start a life with a significant other, build a family, and together grow through life’s different stages.
Aside from getting the said benefits of having a home, it is also considered a smart investment. Numerous experts believe buying a home is a great investment as home values generally increase over time. Also, according to Nadia Evangelou, senior economist with the National Association of Realtors in Washington DC that purchasing a home is often a safe investment that has traditionally been a great inflation hedge to protect against a loss in purchasing power of the dollar.
 
  1. VALUABLE SAVINGS
“A MORTGAGE PAYMENT DELIVERS EQUITY AND SERVES AS A BANK ACCOUNT”
 
Owning a home doesn’t give you only a shelter to live in, but it could also help you build a powerful asset: home equity. This asset is built through your mortgage payments every month. It also signifies the amount of your home that you own free and clear from the remaining balance on your mortgage. The amount of equity you have in your home can help you to build wealth as it can grow over time.
Increasing home equity is a significant part of homeownership as it can be a resource that can be converted to cash when needed. It can be used to pay expenses such as remodeling or any financial needs.
There are numerous ways to build equity in your home. These include making a big down payment, increasing your property’s value, or decreasing your mortgage debt. Knowing how to build equity helps you generate a valuable and significant asset over time.
 
  1. PROTECTS FROM AN INFLATION
“RENTS RISE WITH INFLATION AND MORTGAGES REMAIN STABLE”
 
Finding a place to live is not an easy task. There are a lot of things to take into consideration when making a decision. One of the considerations is deciding whether to buy or rent a home.  It is really important that before finalizing your decision you must consider which option is best for you. The major factor that should be considered is how much you’re willing to spend. Renting and buying a home both have their advantages and disadvantages.

One of the pros of renting a home is financial freedom. You do not have to struggle with repair and maintenance costs since this is the landlord’s responsibility. You have no responsibility to maintain the rented area. You can just tell your landlord to do all the repairs and maintenance for you. Also, you get more flexibility, you can make a quick decision to move out. However, the rental fee can be increased by your landlord at any time. You can’t build equity also if you’re just renting. It will be your home, but it won’t be your asset. Moreover, there are no tax benefits to renting a home.

On the other side, owning a house can serve as an investment. You can buy it and consider renting it out to earn monthly profits. There are tax benefits also as you can deduct your mortgage interest payment. In addition, you build equity while paying off your loan. Most importantly, you have your privacy.
 
  1. TAX CONSIDERATION
“HOMEOWNERSHIP CAN OFFER MORTGAGE AND OTHER REAL ESTATE DEDUCTIONS”
 
Owning a home provides you with many tax benefits. One of the several tax advantages of owning a home is you can claim a home mortgage interest deduction. You may also have paid mortgage points to your lender where you may be able to deduct the cost. Furthermore, you may be able to deduct private mortgage insurance (PMI) if you have an Adjusted Gross Income (AGI) of less than $100,000. Aside from the said benefits, more perks await you when you buy your own home.
 
Buying a home is energy consuming — it could drain your mind from thinking what the things that should be considered when purchasing a home. Luckily, if you like to find out more about homeownership, shoot me a message or give me a call! I’m more than happy to help you along your path toward homeownership.

 

 

 

 

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