Learn how you save money when you buy a house
To buy a house or not buy a house, many people face that question each year. Is being a homeowner all it’s cracked up to be? Can buying a house really save you money? Take a look at 3 top reasons buying a home can save you money.
Money saver #1 — Investment potential
How many times have you heard this one? Well, it’s true. Fork out hundreds of dollars every month for a piece of property that doesn’t belong to you or you can put that money toward your ‘investment.’
Homes consistently appreciate in value. Sure, there are times when the market is down, but for the long haul, a home is a good investment. Nationally, home prices went up more than 50% in the past five years. In some areas of the country, like San Diego, Los Angeles, Miami, and Washington, D.C., the prices have doubled. This is better than the stock market.
Money saver #2 — Capital gain
Capital gain is a profit you gain from making an investment. If you buy a home, then sell it and make a profit, this is a capital gain. The good news is you can profit from this by not having to pay taxes on your profit.
Exclude $250,000 as a single or $500,000 as a married couple of profit from capital gains as long as you’ve lived in your house for two years. This means you can move every 24 months and keep the profit. You don’t have to buy again, you just profit from the gain.
Money saver #3 — Property tax deductions
Save money as a first time homebuyer with your property tax deductions. The taxes on your first home are fully deductible for income tax purposes. Thanks to the Housing Assistance Tax Act for 2008, also deduct your property tax even if you don’t itemize your taxes. These savings really add up.
There are many reasons to buy a house. These three money savers are just the beginning. Over the years, buying a home means saving money, security and stability for your family. All in all, it’s still a good idea.