If your lease is up for renewal soon, and you’re trying to make the decision between continuing to rent or purchasing a home — we encourage you to think about the pros and cons of each option. It’s a big decision. To help, we’ve put together some of the notable benefits that come along with owning a home. If they encourage you to take the next step, it’s easy to get in touch with one of our Preferred Lenders. They can help you determine your purchasing power and come up with a game plan to own a new construction home sooner than later.
THE BENEFITS COME TAX SEASON
We’re all too familiar with tax season. Whether or not you file your taxes yourself or you enlist the help of a professional, it’s stressful. The good news is — owning a home makes you eligible for tax breaks that you don’t qualify for if you rent. A tax preparer can help you navigate the following benefits afforded to homeowners.
- MORTGAGE INTEREST DEDUCTION: When you pay your monthly mortgage payment, part of that payment goes towards interest on the loan. Fortunately, the amount that you pay in interest on your home mortgage can be used as a deduction when you file your taxes — reducing your amount of taxable income. This tax break is permitted on up to $750,000 of mortgage debt for couples filing jointly, and up to $375,000 for those filing separately.
- HOME OFFICE DEDUCTION: This benefit used to be somewhat limited in scope, but with more of us working from home, it now comes into play more often. To take advantage of this deduction, you must have a dedicated space in your home used for business. For example, a spare bedroom or flex room that you turned into a home office would qualify. There are two ways to calculate your deduction. The regular method is calculated by determining what percentage of your home is used for business. A simpler option allows you to deduct five dollars per square foot, up to 300 square feet for business use of your home.
- MORTGAGE INSURANCE DEDUCTION: Mortgage insurance is commonly included in monthly mortgage payments for homeowners who put less than twenty percent down on their new home at closing. If you pay mortgage insurance and fall in a certain income bracket, the expense of mortgage insurance can be deducted from your taxable income. This is the case for couples who have an adjusted gross income of less than $100,000 when filing together.
BUILD YOUR WEALTH, NOT YOUR LANDLORD’S
If you rent, you pay hundreds or thousands of dollars each month to reside in your home. At the end of a lease, what do you have to show for it? Not much, right? By renting, you’re ultimately paying off the mortgage of someone else’s property. Alternatively, when you own a home, your monthly mortgage payment builds home equity, and ultimately, your wealth. People who have adequate equity in their homes can take out home equity loans. These loans are usually marked by low interest rates and are often used for large expenses like home improvements. As a rule, a well maintained house in a desirable area tends to increase in value over time and should prove to be a worthwhile investment when it comes time to sell in the future.
THE OPTION TO MAKE YOUR HOUSE A HOME
When you’re renting, making the space feel like your own is tricky. With each picture you hang on the wall, you have your security deposit in the back of your mind. Pet policies can prevent you from bringing home a furry companion and your lease often restricts painting or transforming the look of your rental unit. Owning a home gives you much more freedom. Accent walls. Built-in shelving. The options are endless. Even better, new construction allows you to personalize your home from the jump. Rather than renovating an existing home, you get to have a say in how it’s built and designed, so that it reflects your style and your lifestyle from day one.
GET MORE OUT OF YOUR NEIGHBORHOOD
If you long for a sense of community and comradery, owning a new construction home in one of our communities could be a great fit for you. Because many of the homeowners move in around the same time, they tend to get to know each other better than when you move into an already established neighborhood. Plus, ongoing connection between neighbors is encouraged through shared amenities, including pools, clubhouses, and gyms. It’s not uncommon for folks in StyleCraft communities to get together on a monthly or weekly basis — we’re talking book clubs, happy hours, playdates with kids, and more.
Sold? We make taking the step towards homeownership easy. With new construction, you get all the benefits of homeownership, without the bidding wars and uncertainty that come with the resale housing market.