It used to be the American dream was not quite complete if it included a small piece of land with a home they could call home. A part of the retirement planning was to repay this house and live in their old age.
Times have changed!
Today's society is more mobile. We buy and sell houses almost as often as we change cars, rarely staying in one place long enough to pay the mortgage.
Some owners do not pay the mortgage, to turn around and get a reverse mortgage to make ends meet.
Is it still worth buying a house?
all depends on your reasons for buying or renting
buying a home for tax benefits
There is no doubt -. buying a home can save you money on your taxes
you can generally deduct your mortgage interest and property taxes.
If you receive a certificate of qualified mortgage (MCC) of a unit or a state or local government agency under a qualified credit certificate program, mortgage credit interest can directly reduce your tax liability
These advantages can make buying a home seems like a proposal without losing. However, you will spend more money on your home you save taxes.
Make sure you consider all the pros and cons, not just tax savings on income, before you commit to buy and maintain a home.
Use a mortgage as a forced savings plan
greatest asset many people have when they reach the retirement age is their home.
much of the value of the house is often the result of appraisal price, and if they lived in the house for years and have resisted the urge to repeatedly refinance, mortgage may be weak or even paid.
Living in your own home, the money you would otherwise pay rent goes first to interest and then pay the balance.
Just by making your house payment each month for years, you can build equity, without even thinking.
On the other against the money you spend on rent is gone. If your rent is cheaper than you would pay to buy a house, you can put the difference in savings even
You will need considerable self-discipline, however, because of putting money away in savings -. Through good times and bad - is not easy
The paris on property
over long periods of time, house made impressive gains in value. . If you bought a house 30 years ago, almost everywhere in the country, this house was probably one of the best investments you could make.
There is also a great hedge against inflation, the dollar value of real estate goes up when the value of every dollar falls.
real estate can be a lousy investment in the short term, however.
If you bought real estate there are five years, especially in a tough area hit by the slowdown in housing, you are painfully aware of this. Being forced to sell when the price is low can be financially disastrous.
Are you a handyman?
What can go wrong with a house? Not bad, actually. Houses can adjust, leak, squeak, and be infested by termites. new or old houses may suddenly need a new heating system, or a new roof.
When you have an owner, he sent someone to fix it and pays the bill. If you buy a house, you may find yourself wishing you had an owner to call.
On the other hand, when it is your home, you have more control over the way the house is maintained. You can paint the color you want (this side of the good graces of your homeowners association), and you should not expect your landlord to get around to it.
houses occupied by owners are often in better shape holiday, because when you are living in the house, you care more than anyone about his condition.
Get more or less for your money
when house prices were soaring, it was cheaper to rent than to buy a house in most parts of the country. Now, with house prices falling, the opposite may be true. There is no fixed rule as to whether buying or renting is cheaper - it all depends on the market you are in
When comparing the cost of renting versus owning a monthly basis, do not forget to do. provision for the additional costs of the property, such as maintenance.
on the other hand, if you buy a house with a fixed mortgage, your total interest and principal payment remains the same throughout the term of the loan. Only your property tax bill can go over the years.
If you rent a home, your landlord can always increase the rent. It could even sell the property, forcing you to move. Saving a little in rent now may not be a good idea if the rent goes up and you have to pay later.
Is a part owner of the house of your retirement plan?
photo credit: Maille via photopin cc
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