Free financial advise on Buying vs Renting in San Diego to buy a home in Oceanside,
Carlsbad, La Costa, El Cajon and Carmel Valley - Del Mar
Buying vs. Renting |
| Well-known financial advisors such as your
neighbor and your chiropractor advise you to buy a home. Before you flip a
coin, consider these points. (If you're like most people, you are better
off buying.)
If you move regularly from city to city or you have credit problems or simply can't afford the monthly money commitment, buying may not be for you. Other than that, renting for years becomes irrational financially. The longer you rent without buying, the more you lose. Owning a home means you have to pay for the mortgage each month, real estate taxes, homeowner's insurance, maintenance costs and incidentals. At the time of purchase you must take into consideration the closing costs in addition to your down payment. Your REALTOR will be able to assist you in calculating the costs. |
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Once you own a home, you'll gain some sizable tax benefits. You can deduct the cost of your mortgage loan interest from your federal income taxes, and usually from your state income tax. The interest on a home loan makes up most of the payment for over half the term of the loan. You can deduct many of the closing costs in the tax year that you purchase your home. You are also allowed to deduct the property taxes you pay as a homeowner. You will also be the beneficiary if the home appreciates in value. If a home appreciates in value, a married couple can have up to a $500,000 tax free capital gain with the two-year personal residence exemption. The taxpayer must live in a primary residence for two of the last five years to qualify for a $250,000 gain exclusion ($500,000 for married couples.)
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| Owning your own home has benefits other than
financial. Homeownership remains part of the traditional American Dream. For the first time in history, America offered
ordinary people the right to own their land and their homes outright,
indenturing their property to a friendly banker rather than their bodies
to a feudal lord. You can modify your living arrangements without
consulting with a landlord, your monthly payments are under your control, rather than
subject to the landlord's decision, moving due to the sale of the property
is your decision rather than the landlords … and on and on.
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