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Is Buying a Home Still a Smart Plan?

With the burst of the housing bubble, credit crisis, and millions of foreclosures across the country, you may wonder if buying a home is such a good idea after all. However, it’s important to consider all of the facts. The important message to take away from these events is not that buying a home is a bad idea, but that you must be smart about buying your home.

The housing market, like every type of market, unavoidably has its ups and downs. That doesn’t mean buying a home is a bad investment. As a long-term investment, homeownership is still one of the best investments for individual households. Historically, real estate has consistently increased in value, despite shorter periods of depreciation due to local markets and/or national economic conditions. The data shows that homes generally appreciate about 5% per year.

Savings & Investment

Five percent may not seem like a great return on investment, but you have to think about it in the context of the situation. For example, let’s say you put 10% down on a $200,000 house. That’s a $20,000 down payment, or initial investment. At a 5% annual appreciation rate, your $200,000 home would gain $10,000 in value during the first year. Earning $10,000 on an investment of $20,000 is a whopping 50% return.

For further perspective, let’s say instead of spending that $20,000 on a down payment, you invested it in the stock market. With a 5% return, you would gain only $1,000 in profit.

Tax Benefits

So now you’re saying that a home may have a higher return, but that’s before you consider all of the costs of home ownership, such as taxes, etc. Well, think of it this way: your property taxes as well as the interest on your mortgage are both tax deductible. You can deduct those costs from your income, thus reducing your overall taxable income. In other words, the government is subsidizing your home.

Other Benefits

It’s easy to get carried away with all of the economic reasons for home ownership, but it’s important to remember that not every reason is financial. Have you ever wanted to paint the walls of your apartment? Well when you’re renting, you can’t. Has anything in your apartment ever needed updating, but the landlord refused to do it? When you own a home, you can make the space yours in almost any way you want. And you benefit when you do home improvements, both financially and psychologically. Homes generally have more space, for storage, living, etc. than other living arrangements. Not to mention that you have space outdoors for barbecuing, pets, and kids. Owning your home carries with it a sense of pride, accomplishment, and even an elevated social status.

So when you’re considering buying a home, consider the broad range of benefits that owning a home can have. And always make sure you have an experienced real estate agent and loan officer to help make sure you’re getting a home that is right for you, both financially and psychologically.

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Thank you for visiting today. If this is your first visit, take your time and look around. I have plenty of information and resources available to you. If you are a return visitor, thank you. I would love to hear from you and tell you how I can serve all your real estate needs.

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Curtis and Patricia Sheets
16503 Booker T Washington Hwy
Moneta, VA 24121
Phone: (540) 293-1033
Fax: (888) 629-1611
Email:
Curtis@LoveToSellYourHome.com
Patricia@LoveToSellYourHome.com

Testimonials

Curtis and Pat are very courtious and professional. You'll get top of the line service and they will go out of their way to make sure you're satisfied. They treat you like family and stay in touch. We couldn't have asked for better realtors or friends! Tara Davidson Fain
We would like to take this opportunity to thank you for helping us find a great home to live in. We first spoke to you two years ago. At that time, you knew that we were not yet ready to purchase a home or to move. Still, you showed us a few houses. You also took the time to show us some of the highlights of the area, such as the Roanoke Star and the Market District. Over the following two years, you always kept in touch. You sent us nearly 350 houses to review and personal notes about how we were. When we sold our house in NYC and came down to Roanoke, you took us around again and we found a dream house. We still had business to finish in NYC and you took charge, getting an inspection of the home and arranging for a closing agent to handle the purchase. Thank you for finding just the right home and for treating us as friends, not as customers. If any of our friends wants to make a move out here, we would recommend you and ReMax without reservation. Alfred and Clara Rodney
We bought our house with Patricia & Curtis. They were very knowledgeable, fair and honest and very helpful. We would highly recommend them to anyone looking to buy or sell real estate. It was a pleasure to visit houses with them. Jean-Luc and Regine Willem
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Thank you for visiting today. If this is your first visit, take your time and look around. I have plenty of information and resources available to you. If you are a return visitor, thank you. I would love to hear from you and tell you how I can serve all your real estate needs.

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