When I created my personal growth bucket list, I never had buying a house as part of my financial bucket list. Don’t get me wrong, I had always assumed that one day I would own a house. I guess it was just never a priority for me compared to other financial goals. This may be because I always considered myself somewhat nomadic. However, now that I am a married and a bit older, buying a house seems to be a new priority.
With mortgage rates being so low, many may feel this goal even more urgently than before. The question is, is buying a house worth it?
According to a recent survey from Forbes Advisor, the answer seems to be “yes!”
In the survey, Forbes asked about two dozen financial and real estate experts if the American dream of homeownership is still a good long term investment. The result? Nearly 57% said that buying a house is definitely a smart long term investment.
Should buying a house be on your financial bucket list? Well, let’s dive into reasons why it should be!
Buying a House is often Cheaper than Renting
Don’t get us wrong, saving enough money for a down payment can be difficult. Also, a lot of your monthly costs will depend on where you live. But by using the Renting vs Buying Calculator from MortgageCalculators.info you can easily see if this is a benefit for you. When doing your research also remember to think long term. In most places, landlords seem to increase rent about 7% a year. So though it may seem like you are saving money now, in the long run, this might not be the greatest deal.
For many people, buying a house is a big item on their financial bucket list. But is it still worth it? Let’s dive into reasons why it should be! #FinancialBucketlist #BuyingAHouse #AmericanDream
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It will help organize your other Financial Bucket List items
It seems weird to say this, but setting the goal to buy a house can help you with your other finances too. Just like when you start a Travel Savings Account, buying a house takes organization, focus, and tasks to help you complete your goal. In fact, Realtor.com came up with a 12 point checklist to help get you organized. But what we found interesting was that before even talking to a realtor, you need to take stock of your own personal finances. Then they offer ways to improve your situation so that when you are financially ready, you can obtain that dream home.
Buying a House is Tax Deductible
To paraphrase Ben Franklin, “in this world nothing can be said to be certain, except death and taxes.”
Every April, most people scramble to figure out their taxes and in general how much they owe. It can often be quite a stressful time. But one of the financial benefits of buying a house is that several of the expenses are tax deductible! This can be seen, especially in the beginning, when you’re able to deduct things like your Mortgage Interest and possibly your property taxes. Therefore, with the added savings, you might receive a bigger tax refund to put towards other financial bucket list items.
Your Credit Score will Improve
Now, don’t get us wrong, initially when you buy a home, your credit score will drop. Of course this should make sense as you just took out a pretty big loan. But this is only temporary while you prove that you can pay it back. According to an article from the SFGATE, paying on time should increase your credit score. In fact, according to their research, making regular payments is “the single most important factor influencing your credit rating.” So, just be organized and diligent on paying on time to help that credit score grow.
It is a Good Investment for your Financial Bucket List
When we are little and play Monopoly, one of the first things we learn is that owning houses and hotels is the best way to increase the rent of a property. In fact, the more houses equals more rent paid, leading you to becoming the richest player and thus the winner.
Now, in real life, buying a house isn’t always about collecting rent and sticking it to your friends on game night. But there is no doubt that buying a house can be a great financial bucket list investment. This can easily be seen when you check out CoreLogic’s home price index to review the year-over-year changes of different home markets around the country.
So is it Time to go Shopping?
As you can see, buying a house can be quite beneficial to most people these days. This can be especially true after exploring all the costs involved when using an Advanced Mortgage Calculator. But everyone’s financial bucket list is different. So, is buying a house on your personal growth bucket list? Do you equate home ownership with financial success? Or is there more important goals that you have to accomplish first financially? Let us know in the comments below!
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