The Benefits of Home Ownership

Posted on March 22, 2023 by Jim Armstrong

Homeownership is a dream for many people. It is a sign of success, independence, and stability. There are numerous benefits of owning a home, from financial security to emotional well-being. In this article, we will outline the advantages of homeownership and show you why making the commitment to invest in real estate is a smart choice. Buying a home makes more sense than renting

1. Building equity
When you own a home, you are building equity. This means that as you make mortgage payments, you are increasing your ownership in the property. Additionally, property values in most areas tend to increase over time, meaning that the longer you own your home, the more equity you will build.

2. Tax benefits
Homeownership comes with some tax benefits that renters do not have access to. Most notably, you can deduct certain portions of your mortgage interest and property taxes from your taxable income. This can result in significant savings, depending on the size of your mortgage and the location of your property.

3. Control over your living space
As a homeowner, you have complete control over your living space. You can make any modifications to your home that you want without having to ask a landlord for permission. This allows you to personalize your living space and create a home that truly reflects your personality and lifestyle.

4. Stability
Owning a home provides a sense of stability that renters do not have. When you own a home, you do not have to worry about rising rents or lease renewals. You have the security of knowing that you can live in your home for as long as you want, as long as you continue to make your mortgage payments.

5. Investment
A home is an investment. While there are no guarantees that your property value will increase over time, history shows that real estate tends to increase in value over time. This means that homeownership can be a smart long-term investment that can provide a significant return on your investment.

6. Social and emotional benefits
Owning a home can provide social and emotional benefits as well. Homeownership allows you to establish deep roots in a community, build strong relationships with neighbors, and feel a sense of pride in your property. Additionally, studies have shown that homeowners generally have better mental health and higher levels of life satisfaction than renters.

In conclusion, owning a home provides financial, social, and emotional benefits that renters do not have access to. While it can be a big commitment, the benefits of homeownership make it a smart choice for those who are ready to make the investment. If you are considering purchasing a home, speak with a professional REALTOR to learn more about the process and find the home that is right for you.

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Why Do People Sell Their Home in Today’s Real Estate Market?

Posted on March 21, 2023 by Jim Armstrong

Spring housing martket selling a home

In today’s real estate market with higher (but still historically low) interest rates and without a lot of choices for a new because of low inventory, you may wonder why anyone would want to sell their home now. Here are some general points on why someone might consider selling their home in today’s real estate market:

1. High Demand: The current real estate market is experiencing a high demand for homes, which means that sellers can potentially receive multiple offers and sell their home quickly.

2. Home Prices Have Peaked: Because of low inventory and high demand during the last couple of years, home prices have peaked. Though the demand is still there, rising interest rates have taken many buyer out of the market because of affordabilty, especially on the lower end of the scale. The forecast for 2023 is that there will be a slight drop in home prices (probably under 5%). In order to maximize the equity a home owner has in their property a seller needs to sell asap. It’s predicticted that home values will continue to drop for the next few years, though no one knows for sure. Most homeowners have seen an increase in the equity of their homes since they purchased it due to rising property values. This means that sellers will be able to sell their home for more than they originally paid and make a profit.

3. Opportunity for Upsizing or Downsizing: For those looking to either upgrade or downsize their living situation, the current market presents an opportunity to buy and sell at potentially advantageous prices.

4. Changing Lifestyle Needs: A seller’s lifestyle needs may have changed due to various reasons such as an expanding family, relationship status, career changes, relocation, or financial considerations, making it necessary to sell their current property and move on.

Whatever the reason, your fist step should be to talk with a professional REALTOR to find out what your options are.

What’s Ahead for Home Prices in 2023

Posted on March 20, 2023 by Jim Armstrong

Over the past year, home prices have been a widely debated topic. Some have said we’ll see a massive drop in prices and that this could be a repeat of 2008 – which hasn’t happened. Others have forecasted a real estate market that could see slight appreciation or depreciation depending on the area of the country. And as we get closer to the spring real estate market, experts are continuing to forecast what they believe will happen with home prices this year and beyond.

Selma Hepp, Chief Economist at CoreLogic, says:

“While 2023 kicked off on a more optimistic note for the U.S. housing market, recent mortgage rate volatility highlights how much uncertainty remains. Nevertheless, the continued shortage of for-sale homes is likely to keep price declines modest, which are projected to top out at 3% peak to trough.”

Additionally, every quarter, Pulsenomics surveys a panel of over 100 economists, investment strategists, and housing market analysts regarding their five-year expectations for future home prices in the United States. Here’s what they said most recently:

So, given this information and what experts are saying about home prices, the question you might be asking is: should I buy a home this spring? Here are three reasons you should consider making a move:

Buying a home helps you escape the cycle of rising rents. Over the past several decades, the median price of rent has risen consistently. The bottom line is, rent is going up.
Homeownership is a hedge against inflation. A key advantage of homeownership is that it’s one of the best hedges against inflation. When you buy a home with a fixed-rate mortgage, you secure your housing payment, so it won’t go up like it would if you rent.
Homeownership is a powerful wealth-building tool. The average net worth of a homeowner is $255,000 compared to $6,300 for a renter.

Experts are projecting slight price depreciation in the housing market this year, followed by steady appreciation. Given that, you may be wondering if you should move ahead with buying a home this spring. The decision to purchase a home is best made when you do it knowing all the facts and have an expert on your side.

Bottom Line

Reach out to a local real estate professional to make the most informed decision about your next move.

Leverage Your Equity When You Sell Your House

Posted on March 15, 2023 by Jim Armstrong

One of the benefits of being a homeowner is that you build equity over time. By selling your house, that equity can be used toward purchasing your next home. But before you can put it to use, you should understand exactly what equity is and how it grows. Bankrate explains it like this:

“Home equity is the portion of your home you’ve paid off – in other words, your stake in the property as opposed to the lender’s. In practical terms, home equity is the appraised value of your home minus any outstanding mortgage and loan balances.”

Majority of Americans Have a Large Amount of Equity

If you’ve owned your home for a while, you’ve likely built up some equity – and you may not even realize how much. Based on data from the U.S. Census Bureau and ATTOM, the majority of Americans have a substantial amount of equity right now (see graph below):

And having such large amounts of equity is a benefit to homeowners in more ways than one. Rick Sharga, Executive Vice President of Market Intelligence at ATTOM, explains:

“Record levels of home equity provide security for millions of families, and minimize the chance of another housing market crash like the one we saw in 2008.”

Over time, your home equity grows. In addition to providing financial stability while you own your house, when you’re ready to sell it, that money could go a long way toward paying for your next home.

Bottom Line

By selling your house and leveraging your equity, it can be easier to pay for your next home. Connect with a trusted real estate advisor so you can find out how much home equity you have and start planning your next move.

Equity Gains for Today’s Homeowners

Posted on March 6, 2023 by Jim Armstrong

Today’s homeowners are sitting on significant equity, even as home price appreciation has eased recently. If you’re a homeowner, your net worth got a boost over the past few years thanks to rising home prices. Here’s what it means for you, even as the market moderates.

How Equity Has Grown in Recent Years

Because of the imbalance between how many homes were for sale and the number of homebuyers in the market over the past few years, home prices appreciated substantially.

And while price appreciation has slowed this year, that doesn’t mean you’ve lost all the equity in your home. In fact, the latest Homeowner Equity Insights report from CoreLogic finds the average homeowner’s equity has grown by $34,300 over the past year alone. Look at market statistics for Salem and other North Shore communities here!

And if you’ve been in your home longer than that, chances are you have even more equity than you realize.

While that’s the national number, if you want to know what happened in your area, look at the map below from the Federal Housing Finance Agency (FHFA). It shows on average how much home prices have risen over the past five years, which has been a major driver behind equity growth.

Why This Is So Important Right Now

While equity helps increase your overall net worth, it can also help you achieve other goals, like buying your next home. When you sell your current house, the equity you’ve built up comes back to you in the sale, and it may be just what you need to cover a large portion – if not all – of the down payment on your next home.

So, if you’ve been holding off on selling, it may be time to find out how much equity you have and how it can help fuel your next move.

Bottom Line

Homeownership is a long game, and if you’re planning to make a move, the equity you’ve gained over time can make a big impact. To find out just how much equity you have in your current home and how you can use it to fuel your next purchase, connect with a local real estate professional.

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