Community News

With all the economic and real estate turmoil of the last few years, some homeowners and some possible first-time home buyers are wondering why they should own a home. They look at all the responsibility of upkeep, see their friends and acquaintances lose their homes, and watch the falling market nipping at their heels for the last few years. Some renters are thinking that it's much safer to just keep renting, rather than buying their first home.

 I submit that there are many good reasons for buying your first home, for moving up or down to a more fitting size or location, or to "bloom where you are planted."

 1. Interest rates are at the lowest rates on record at around 4%. They're probably not going much lower. And if inflation sets in, as it's bound to do sometime soon, you'll be very happy to have a low-interest loan. A rise in interest rates from 4.3% to 6.3% would raise your monthly repayment by a fifth. That's a lot!

 2. Buyers are still getting "good deals," although there are fewer short sales and foreclosures than we've had in the past. But many sellers have repositioned their prices and are close to meeting the distressed sales' prices in their price range. As sales prices have dropped, we seem to be close to fair value in relation to area household incomes.

3. Tax Benefits: More than 17,000 REALTORS will be meeting in mid-May in Washington DC on the mall to demonstrate our industry's interest in the homeowners of America. One of the subjects is maintaining the deduction of interest paid on real estate. It's one of the benefits of home ownership that has helped millions of people. Another break that helps is that you can deduct real estate taxes (if you itemize deductions). Many people find that these tax breaks mean owning costs them less than renting. And, in the future, you'll own your home, instead of helping a landlord own the home.

 4.  Pride of ownership can be yours. What a wonderful feeling to paint a room, remodel your kitchen or bathrooms, or even move walls or build an addition. It's your home and you can do with it what you want to make it more comfortable and a haven at the end of the day.

 5.  Home ownership's largest advantage may be inflation protection. Over the long term, housing has tended to beat inflation by a couple of percentage points a year (Case-Shiller) If you can see inflation rearing its ugly head in the future, you will be glad that you own your own home. Especially if you have a low-interest rate.

 6.  Building equity can be a forced savings plan. Even if you have to reach a bit to make the monthly payment, you'd still be paying rent otherwise, and it would just be money out the window. When you're buying a home, each month some of the payment goes to pay off the principal and thus build up your equity. Even if you're planning to pay less in rent and save the difference each month, it's difficult for most people to keep that up month after month. Other expenses that come up can easily take that difference. But if it's part of your mortgage, you'll do it. And automatically pay yourself.

 7.  Sooner or later real estate prices will start rising again and your investment in your home will be a good one. That's not why we buy homes, but through the years it beats the risks of stocks and bonds and gives homeowners a way of linking part of their portfolio to the long-term growth of the economy.

Let us help YOU find YOUR place in this "Last Best Place!"

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Sharon Tudor Isler, Broker, CRS, GRI, SRES 556-5048
Sharon@Bozeman-RealEstate.com

Brian Tudor, Sales Associate, GRI, GREEN, SFR 556-5068
Brian@Bozeman-RealEstate.com

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