Most people are always thinking if it is better to rent rather than buy a home and become a full pledge homeowner. The reality here is that homeownership is key to wealth and stability. Why would we say that? Is it because we just want to get your approval and then get our partners for your home loan? That is not the case because we are just saying the obvious.
Homeownership and Wealth
A home is an investment since it is a fixed asset. Accounting wise when you buy a new home which includes the house and lot then it is a very good equity investment. A physical house depreciates over time but the land where a home is increasing in value According to an article by John Taylor, CEO of the National Community Reinvestment Coalition, those who lack the opportunity to become homeowners have a weakened ability to reinvest their wealth.
“We traditionally have been huge supporters of homeownership. We see it as a way to provide stability for households but also as an asset-building strategy. If you continue to be a renter, locked out of the homeownership arena, increasingly those things are further and further out of reach. They’re joined at the hip. They perpetuate each other.”
It is, therefore, primary consideration to buying a new home not just anywhere but somewhere which will also protect your investment. When the time comes your home will appreciate in value and you can capitalize on this to issue a new loan and expand your business.
Homeownership and Stability
If you are renting a home, you will not know what the owner will decide eventually plus you are paying an expense and not an investment. Homeowners not only have an investment since they also own have a home to relax after a busy day of work, This assures that your family is well protected and there is nothing to worry about.
In fact, a survey of property managers conducted by rent.com last month disclosed two reasons tenants should feel less stable with their housing situation:
- 68% of property managers predict that rental rates will continue to rise in the next year by an average of 8%.
- 53% of property managers said that they were more likely to bring in a new tenant at a higher rate than negotiate and renew a lease with a current tenant they already know.
Therefore, despite the trend of rising mortgage rates and home prices it is coinciding with a parallel increase in rental prices. Homeownership is not comparable to renting. While there are tons of prohibitions on what you can do as a tenant of a rented place, in homeownership you have all the right to design your home and do whatever you like.
Overall, now is the time to consider homeownership because the real estate industry is not volatile yet. In addition, a new mortgage reform law will create an even better atmosphere – mortgage will be easier and the more reason to get a home.
For those who want to engage in the real estate industry and become our partners, please visit our Partner Portal page.