The American dream, owning your own home! Yes, Virginia there is a Santa Claus in the form of the IRS; one of the largest benefits we receive from the tax code is the home deduction.
There are many factors that can go into the decision making process on whether you purchase your dream home or you pay the landlord’s mortgage; but none larger than the tax benefit you receive. Your mortgage interest and taxes are deducted from your gross income thus reducing your tax burden by your effective tax rate. With private mortgage insurance, you can put down as little as 3.5 percent down, so the down payment no longer should prevent you from buying your dream home.
In our opinion the second best reason to purchase after the tax benefit is equity, the difference between what you own on the property and the present day value. Every payment made increases your equity by reducing the amount owed along with the appreciation in the property value.
One of our group’s favorite stories happened last year when we met new clients at one of our rental listings. They were renting the same home for over 13 years with nothing to show for it and the landlord decided to sell the property leaving them in the predicament of finding a new place to live. After realizing that paying the broker’s fee, security deposit and first month’s rent, they had almost the amount needed for a down payment on their own home. Today they are no longer paying the landlord’s mortgage but their own and are happily settled in their lovely home!
Call the Wyckoff Group today to see if we can help you find your dream home!