The American Dream
For many American consumers, like yourself, purchasing a home is a core value of the American Dream. Typically, it’s also one of the most expensive purchases you’ll make in your life. Purchasing a home can be a complicated process – with all the steps, tasks, and different parties, it can be difficult to navigate, especially with the wrong help in a competitive market.
Even with technology and the ease of access to information available to consumers, it’s in your best interest to work with a real estate professional, like myself, who can guide you through the complicated home purchasing process. That’s why, according to the National Association of REALTORS®, “89% of Americans purchase their homes through a real estate agent or broker.”
Easy Homeownership Guide
To make the complex homebuying process more digestible, we’ve created this easy-to-follow guide that will educate you about the process and simplify it. In this guide, we’ll go over:
- Benefits of homeownership: So, you know all the value you’ll receive from owning a home.
- The home buying process and who’s involved: So, you know what/who to expect during the process.
- Advantages of working with a real estate professional: So, you know my responsibilities, what to expect from me, and how to choose the right representation for yourself.
- Common homebuying mistakes: Since there are many mistakes a homebuyer can make during a transaction; I’ll cover the most common mistakes and how to avoid/prevent them.
- How mortgage loans work: So, you can start your search for a lender and get the best offer.
Additionally, I’ll share 2 activities for you to complete. The first activity will help you prioritize home features, amenities, and other preferences. This helps set a basis for the type of homes I’ll share with you and the area. The second activity will help you understand your unique situation for your home search.
Ready to have a simple, stress-reduced homebuying experience? Use this guide to help you understand the home-buying process and ensure you have the best experience possible!
The Homebuying Process
In the image below, you can see the general process for buying a home. This is a general timeline, your process may vary, but this is a good overview so you can envision what happens in what order. Click on the image to download a PDF version for your personal use.
There are many benefits that come with homeownership. Besides owning your home, there are intangible benefits too. Below is a list of benefits you can enjoy as a homeowner.
- Higher Quality of Life
Compared to renters, most homeowners say they’re happier and healthier since purchasing their homes. They tend to be more involved in the community and host more parties with friends/family. They often start new hobbies like gardening, cooking, and grilling too. Since owning a home takes a lot of work, homeowners say it also gives them a sense of pride and purpose.
- Better Education Opportunities
According to a National Association of Realtors study, Social Benefits of Homeownership and Stable Housing, a purchased home can provide a more stable, nourishing. and enriching environment for children than a rental. Generally, education opportunities are more common in neighborhoods with higher rates of homeownership and community involvement. Children of homeowners are more likely to achieve higher levels of education and higher levels of earnings.
- No Landlord
Landlords can be a nuisance, especially when they are difficult to get a hold of, are late to reply to maintenance requests, or increase rent – you can say goodbye to all of that as a new homeowner.
- Save Money by Avoiding Rent
Rent across the USA continues to increase. Depending on several factors, like the length of your tenure, your interest rate, and the price of your home, you could pay less per month for your mortgage than your rent. Plus, the money that you pay off, will help you build equity and wealth.
- Tax Deductibility of Property Taxes
You can file a combination of state/local income taxes or sales tax, but only on the property owned.
- Accumulate Wealth with Equity
Equity is the amount of home you’ve paid off and actually own – it doesn’t include your debt. So, if you paid $100,000 and have $100,000 of debt on your $200,000 home, your equity is $100,000. You build equity and increase the market value of your home through a larger down payment, by paying off your loan, if local home prices increase, through home improvements, etc.
- Long-Term Appreciation Potential
If you’re planning on staying in your new home long-term, it’s very likely your home will appreciate or increase in value. Home appreciation, aka return on investment, depends heavily on the location of the home. Generally, the value of the land will increase as the actual structure depreciates over time.
- Deferred Gain and Capital Gain
Thanks to the Taxpayer Relief Act of 1997, a single person could pay no capital gains tax on the first $250,000 of profit from selling their home – $500,000 for married couples.
- Tax Deductibility of Interests on Mortgage Loan
If the principal loan of your mortgage loan is $750,000 or less, you could deduct interest expenses from your income taxes through itemization or by filing for a standard deduction on your taxes.
- American Dream
For many people around the world, having a good job, purchasing a home, and starting a family in the United States is the American Dream. It has been in our culture since the early 1930s and it indicates a milestone or sense of achievement for 90% of Americans.
Now that you know some of the benefits of owning a home, the next article we suggest you read is The home buying process and who’s involved
Having a general understanding of the process will help keep the surprises to a minimum.
But before you move on, you should consider that homeownership is not right for everyone. Here is another resource you may want to read to help you decide if now is the right time for you.
5 Questions to Ask Before Purchasing Your First Home