First Time Home Buyers
Provided by Penn Homes - Shreveport Home builders
Shreveport Real Estate
Congratulations on deciding to purchase a new home. You’ll always remember the feeling that comes with buying your first home. The process requires quite a bit of careful research, but that doesn’t mean it has to be difficult. Ask any of our homeowners who have chosen Penn Homes, and they’ll tell you the same thing: When it comes to buying a house, don’t settle for less. From the minute we break ground to the day you move in and beyond, we’ll make sure all the details are right. Because at Penn Homes, we’re just as excited as you are.
Owning Verses Renting
Q: What are the advantages of owning verses renting a home?
A: When you’re in your 20s or 30s, you may want to start thinking about your golden years. Paying $750 rent per month now is the equivalent of buying a home for $100,000. In 40 Years with approximately 4 percent inflation per year, your $750 per month rent may increase up to $3,600 per month. With owning you could have your mortgage paid off in as little as 15 years. Owning a home is a very wise investment. Over time you should build up equity that can be used to pay for home improvements, a bigger home, etc. Real Estate historically is one of the most stable markets available to invest your money in. There are also tax advantages to owning. The interest you pay on your mortgage may be tax deductible. Talk to your tax preparer for more information.
Buying a home is probably the biggest financial commitment you'll ever make. Buying a home is not just a dollars-and-cents investment; it's an investment in your life. It will create a sense of stability and identity for you and your family. Regardless of how times change, owning a home remains the cornerstone of the American dream.
The benefits of buying, when able to, far outweigh those of renting. Sure, buying a house takes tons of paperwork and involves commitment to that house. But in the long run, owning a home is extremely important since your home is one of the biggest investments you can make. The key to this is home equity. Equity is essentially the value of the home. This equity almost always increases over time and can sometimes take huge leaps (such as the recent price hikes of homes in California). These huge spikes drastically increase the price of the home and leave the homeowners with a lot of money right beneath their feet that is always available. Also, equity enables homeowners to pull out home equity loans that are based on the value of their homes and generally have reasonable interest rates.
Here are just a few of the many advantages to owning vs. renting
- You can build equity
No matter how much rent you pay, 100 percent of your apartment still belongs to your landlord. But every time you make an amortized mortgage payment, you own a little more of your house. Initially, interest makes up the vast majority of your payments, but the proportion is constantly shifting in your favor. If real estate values rise, you’ll be even farther ahead. The longer you plan to stay put, the more of this benefit you will reap. - Tax Deduction
You can usually deduct mortgage interest on your tax return, which can mean big savings. If you’re in a 28% tax bracket and have a $150,000 mortgage at 7%, the first full year you own your home you’ll most likely be able to deduct more than $10,000 in interest. That translates into a tax savings of almost $3,000. In addition, even if you sell your principal residence for more than what you paid, you may not have to pay capital gains taxes. (There are limits, so consult a financial advisor for advice on your particular situation.) - Pride of ownership
A house may be an investment, but first and foremost it’s a home for your family. Even without the financial benefits, many people like the stability and sense of pride that comes with owning a home. You can renovate it to suit your own needs, plant a vegetable garden in the back and let the cat scratch the walls knowing there’s no landlord to impose his or her rules.