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Is Buying a Home Still a Smart Plan?

With the burst of the housing bubble, credit crisis, and millions of foreclosures across the country, you may wonder if buying a home is such a good idea after all. However, it’s important to consider all of the facts. The important message to take away from these events is not that buying a home is a bad idea, but that you must be smart about buying your home.

The housing market, like every type of market, unavoidably has its ups and downs. That doesn’t mean buying a home is a bad investment. As a long-term investment, homeownership is still one of the best investments for individual households. Historically, real estate has consistently increased in value, despite shorter periods of depreciation due to local markets and/or national economic conditions. The data shows that homes generally appreciate about 5% per year.

Savings & Investment

Five percent may not seem like a great return on investment, but you have to think about it in the context of the situation. For example, let’s say you put 10% down on a $200,000 house. That’s a $20,000 down payment, or initial investment. At a 5% annual appreciation rate, your $200,000 home would gain $10,000 in value during the first year. Earning $10,000 on an investment of $20,000 is a whopping 50% return.

For further perspective, let’s say instead of spending that $20,000 on a down payment, you invested it in the stock market. With a 5% return, you would gain only $1,000 in profit.

Tax Benefits

So now you’re saying that a home may have a higher return, but that’s before you consider all of the costs of home ownership, such as taxes, etc. Well, think of it this way: your property taxes as well as the interest on your mortgage are both tax deductible. You can deduct those costs from your income, thus reducing your overall taxable income. In other words, the government is subsidizing your home.

Other Benefits

It’s easy to get carried away with all of the economic reasons for home ownership, but it’s important to remember that not every reason is financial. Have you ever wanted to paint the walls of your apartment? Well when you’re renting, you can’t. Has anything in your apartment ever needed updating, but the landlord refused to do it? When you own a home, you can make the space yours in almost any way you want. And you benefit when you do home improvements, both financially and psychologically. Homes generally have more space, for storage, living, etc. than other living arrangements. Not to mention that you have space outdoors for barbecuing, pets, and kids. Owning your home carries with it a sense of pride, accomplishment, and even an elevated social status.

So when you’re considering buying a home, consider the broad range of benefits that owning a home can have. And always make sure you have an experienced real estate agent and loan officer to help make sure you’re getting a home that is right for you, both financially and psychologically.

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Dick Stanton Real Estate 
5214 West Seneca Turnpike
P.O Box 515, Vernon, NY 13476
Phone: 315-829-2900, Fax: 315-829-4901
Email: DkStanRe@twcny.rr.com
Owner-Principal Broker: Richard Stanton
 

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Dick Stanton Real Estate

5214 West Seneca Turnpike, Vernon, NY 13476

Phone: 315-829-2900. Fax 315-829-4901

Principal Broker/Owner: Richard Stanton

 

We are Dick Stanton Real Estate in Vernon, New York and We are a 'Hands-on Realtor'.   By that I mean... We believe in serving our clients by being courtesy, professional and knowledgeable.  We work closely with You, and all who have a voice in the Real Estate World.  They include other  Realtors, Attorneys, Financial Institutions, Home Inspectors, Contractors, Appraisers, Surveyors, Code Officers, Well inspectors, Septic Inspectors, Radon Testers and Mitigation personnel. We work especially hard and closely for you.  We are your personal contact, not a computer voice.  We are proud of the work we do everyday by staying close to our clients and contacts.  You have a real person to talk to and so do we.  That's us,  a 'Hands-on Realtor'We are Dick Stanton Real Estate in Vernon, New York.  I am Richard Stanton, The NYS Licensed Real Estate Principal Broker, Owner and Founder of Dick Stanton Real Estate with 30 years experience in the Real Estate World. Please feel free to contact us anytime.

Richard Stanton 315-264-1291 Mobile. 315-829-2900 Office. 315-829-4901 Fax. www.dkstanre@twcny.rr.com. Email.  Donald Stanton 315-264-9369 Mobile. Mike McNaughton 315-264-3081 Mobile.  Maria Stanton 315-264-3727 Mobile. Sandra Stanton 315-264-1293 Mobile.  Thank you.