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Home : Planning Your Finances : Planning for Life Events : Buying a Home : Pros & Cons of Homeownership
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Buying a Home
Pros & Cons of Homeownership
Owning your own home may be part of the American dream, but with it come certain advantages and disadvantages.
When considering if homeownership is right for you, you might consider some of the following.
Pros
Tax Advantages
There are tax deductions related to homeownership that may factor into your income taxes.
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Investment
Your home equity can increase as your home appreciates in value. Home improvements can also add to the value of the home.
There are a number of factors that will determine whether a home will increase in value and by how much.
Lifestyle
Living in your own home obviously affords you more freedom in designing and maintaining your personal space.
It can also be a source of personal pride and generate stronger feelings of community.
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Cons
Expense
For most people who rent, the transition to homeownership means a significant increase in costs. Not only can mortgage
payments be sizeable, but all maintenance and repair costs to your property will be your responsibility. You will begin
paying property taxes, which will vary depending upon the state in which you live and the calculated value of your home.
Liquidity
While it can be major investment, homes can really tie up your cash, creating a squeeze on other parts of your budget.
Many people look forward to a steep appreciation in their home’s value, but that often comes only after years of ownership.
Mobility
Making changes in your personal life or career can be decidedly more complicated when you own a home.
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Transamerica and its representatives do not give tax or legal advice. The material provided is for informational purposes only and should not be
construed as tax or legal advice. Clients and other interested parties must rely solely upon their own tax and/or legal advisor regarding their particular situation.
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