If you are not sure if purchasing Asheville real estate is advantageous in our current economic climate, the blog Housing Marketing Facts has compiled a reassuring list of quotes to help with your decision. Here are nine advantages of home ownership, pulled from their site:
- A temporary $7500 tax credit is now available for any qualified purchase prior to July 1, 2009.
*H.R. 3221 – The Housing and Economic Recovery Act of 2008
- Capital gains exclusion on the sale of your home, as long as you have lived in your home for two of the past five years. You can exclude from federal income tax up to $250,000 ($500,000 if you’re married and file a joint return) of any capital gain that results from the sale of your principal residence, regardless of your age.
*Department of Treasury, IRS Publication 530
- Homeowners may deduct mortgage interest and property taxes as an expense against income.
*Department of Treasury, IRS Publication 936 and IRS Publication 530
- The Home Office Deduction. You may be able to claim a deduction for certain home expenses if you use part of your home for business.
*IRS form 8829 Expenses for Business Use of Your Home
- Fixed-rate mortgages are a hedge against inflation. Although past performance cannot guarantee future trends, real estate has historically appreciated at a higher rate than inflation in most regions. One can certainly expect rents to increase year after year. However, if you have a fixed rate mortgage when you buy a home, you have the same monthly payment for 30 years.
- Homeowners can borrow against the value of their home with a home equity loan when they refinance their mortgage. The annual interest charges on a home equity loan or credit line may be fully deductible when itemized on their tax return.
*IRS Publication 936 Section 2
- According to the 2008 NAR Profile of Buyers and Sellers, first time home buyers made a median down payment of 4%, while repeat buyers who financed their purchase put 15% down, indicating the wealth-building effect of homeownership.
*George Galster, “Land Economics” and DiPasquale & Glaeser, Harvard’s Joint Center for Housing Studies
- The average homeowner’s net worth is $171,000. That’s nearly 36 times that of a renter who has an average net worth of $4,800.
*Federal Reserve Survey of Consumer Finances
- Over 10 years, a $10,000 investment in the stock market at a normal 10 percent market rate would yield $23,600. The same investment as a down payment on a $200,000 home at a normal appreciation rate of 5% would return nearly 5 times the stock market return at $110,300.