The decision to purchase a new home brings a sense of financial integrity and security. Whether it's a place to call home or an investment strategy, buying a home is an exciting time. One of the biggest motivations for buying your home is financial security.
When you buy a house part of payment goes to interest and the other goes to paying down the principle. The difference between what your home is worth and what you owe is your equity. You can sell your home and convert it into cash or you can borrow against it. As a renter you are building equity for the homeowner. Building equity is a way to help one attain financial freedom.
Another advantage to homeownership is that your mortgage payments will remain the same throughout the life of the mortgage (this is a fixed rate mortgage). As a renter you do not know when the landlord is going to increase the rent or how much. With a fixed rate mortgage your payment will remain the same. Your property taxes and insurance may increase but this is marginal. You will have the ability to predict what your housing cost will be for into the future, there is not that advantage to renters.
Houses typically appreciate, or increase in value, over time. When looking at any type of appreciation one needs to look at it in the long term, 10 years or more. Most homeowners who have held their home for this amount of time have seen steady appreciation.
Homeowners enjoy the benefit of tax breakers that renters do not have. The most important tax benefit of homeownership is that your interest on your mortgage is usually deductible. This fact alone can have substantial savings on your federal income taxes.
This is the benefit of just having your own home. If one wants to paint the walls zebra stripes or plant an apple tree in the backyard, one does not have to ask the landlord or property management company for permission. There is a stability in owning a home and living next to other homeowners that is hard to find while renting. "Welcome to my home" just sounds and feels better than "Welcome to my Landlords home that I am temporarily residing in until they decide to raise the rent or sell the property".