Happy African American Family With Cardboard Boxes and Things Moves to a New Home.

Homeownership is something that, for most of us, represents success, stability, and an excellent opportunity to give back to our communities. If we look back, the many benefits of homeownership bought a consistent growth in the number of homeowners since the 1900s, but it wasn’t always like that.

For instance, at the beginning of the 20th century, more than half of US citizens didn’t own homes, hovering around 65% in the Great Depression, where it even increased a tad (68%). However, in the early years of the 1950s, homeownership jumped to 55% and rose steadily throughout the previous century to the point that in 2005, the homeownership rate reached its peak at 70%. 

All in all, the benefits of being a homeowner are many, as this offers people tremendous opportunities to establish the foundation of a stable and secure financial future. 

In this article, we’re bringing you some of the less apparent benefits of homeownership. 

Financial Homeownership Benefits

The most prevalent homeownership benefits fall into the realm of finances. Even though getting a new home is a massive initial investment, it allows the buyer to generate savings in the long term and build wealth. That said, here are a few financial benefits of being a homeowner:

  • The opportunity to build equity: This is basically the value amount of a given asset. As you make your monthly mortgage payments, you will slowly build real estate equity. This is massively different from rent because you are paying off a physical asset instead of paying a landlord.
  • Savings in the long-term: As you build equity, you also save money because there is a wide range of ways you can use your home equity in the future.
  • Building wealth: As your property’s value grows, your equity will do the same, letting you sell your home for a better profit. The extra money can be used to reinvest in another home or another investment property. Plus, you can always turn your current home into a rental to build even more wealth.
  • Expense control: Another benefit of owning a home is knowing exactly the amount of the monthly payments you will be making. If you rent, you are always at the mercy of your landlord, who might increase your rent. 
  • Better credit history: Owning a home can allow you to strengthen your credit as well because you will be continuously making monthly mortgage payments. And as your credit score improves, it will be easier for you to get additional finance options. 

Social Benefits of Homeownership

Diverse Group of Female Friends Enjoying at a Party and Laughing.

Being a homeowner also brings a number of social benefits. For starters, getting a home usually comes with a sense of accomplishment for most, but that’s not all. Homeownership may even benefit your community and your emotional health. 

  • Civic participation: Homeowners add a certain level of stability to the area they live in, contributing to surrounding area maintenance. They are more likely to take part in local community organizations and local politics as well.
  • Health benefits: Studies have confirmed that those who own a home have better self-rated health than renters. They also enjoy better control over their lives, with higher happiness rates and self-esteem overall. 
  • Improved privacy: Being a homeowner gives you more privacy than living in an apartment. This is especially true when you don’t share any spaces or walls with your neighbors or tenants. Also, you don’t have to worry about the landlord’s rules because you are in the landlord’s shoes.
  • Financial education: Being a homeowner also means you will have to educate yourself about finances, and you can pass the knowledge to your children or future generations. 
  • Decreased crime rates: Those who own homes are often more proactive in eliminating neighborhood crime than renters. Those areas with a high percentage of homeowners usually have a range of prevention programs implemented to lower crime rates. 
  • Freedom: Owning a home also means you can customize it however you like. You can renovate, rearrange, and rebuild whatever you want. Making improvements that will only increase the property’s value is smart because you can sell it for an even more significant profit.

Tax Benefits of Being a Homeowner

Several tax initiatives come with owning a home. Here are some of them: 

  • Mortgage interest deduction: The interest you pay on home mortgages is tax-deductible, meaning that you can reduce the taxable income if you deduct the interest you pay on your mortgage.
  • Property tax deduction: You may also be able to reduce your taxable income even more by deducting the tax you pay for your property. 
  • Imputed rent: If you own a home and live in it, you don’t pay taxes on rental income. 

The Case for Owning a Home

The Female Hand Is Using the Key to Open His Own House

Nowadays, many people see being a homeowner as a huge responsibility and choose to pay rent instead. While the benefits of homeownership are tremendous, there are also a few things that some might see as downsides. 

For starters, renting might be more flexible because it allows the freedom to relocate or get a new apartment without much consideration and planning. Still, they are often at the mercy of the market and the landlord, which can cause unnecessary headaches. 

It’s also true that owning a home adds to your list of responsibilities. Let those be financial or home maintenance; they can add up and even be overwhelming at times. Still, most financial situations are predictable in owning a home. 

Also, the initial financial investment is a massive move, and future homeowners should educate themselves about their finance options.  

And if they are financially ready to buy a property and intend to go through with the investment, it’s genuinely a worthwhile move. Apart from the financial and tax benefits, the social advantages of buying a home often overshadow and outweigh the flexibility and low responsibility associated with renting.

Final Thoughts

Having your own house comes with various advantages, but it may often take careful planning and knowledge to make the best of such a massive financial move. As such, if you want to become a homeowner, take some time to familiarize yourself with mortgage rates, market trends, home maintenance processes, and costs. The key to becoming a proud and accomplished homeowner is knowing the responsibilities it takes to own a home and being prepared for every challenge this otherwise joyous and satisfying thing can throw at you at times. 

Want to learn more about the topic? Reach out to us at Habitat For Humanity of Broward and learn about our cause as well.