Is Homeownership Right for You?

Everyone knows this is a buyer's market- so, understandably folks are are trying to decide whether or not it is the right time for them to buy a home. Becoming a homeowner is a big decision that should be carefully considered from the short- and long-term perspectives.

What makes now a good time to buy a home?

There are a lot of reasons that now is a good time to buy a home.  Interest rates are at record lows; home prices are competitive, which allows you to get more home for your dollar; and there is a wide selection of homes on the market to choose from.

Many home owners will also see savings on their federal income taxes for years to come. Deductions are often available for the mortgage interest and real estate taxes you pay each year on your home. These savings can add up significantly over the years. For example, a borrower with a $60,000 annual income with a $180,000 mortgage at a 5.5 percent interest rate would see a savings of $5,939 over the first five years. Also, when you eventually sell your house, there is a capital gains tax exclusion on the

money you make from the sale of your primary home, under a certain dollar amount. 

Renting can be cheaper than buying, why is it better to buy?

Renting is not really cheaper- especially in the long run. Owning a home builds equity and helps grow your personal wealth over time. When you own your own home, you will realize a return on your investment when you sell since housing historically appreciates over the long term. In contrast, you get no return on investment when renting. 

Also, with a fixed-rate loan, your monthly mortgage payment will remain the same. This does not hold true for rent, which can increase each year. If you continue to rent long term, you may find that your rent will eventually be higher than a mortgage payment would have been if you had purchased earlier. And you can never get that money back, unlike the advantage of homeownership. 

Check out our website for a list of tax professionals to help you make the most of tax advantages for homeownership, a list of banking professionals who can assist you with home mortgages, and a list of building professionals who can help you make the best decision when buying, building and remodeling a new home.

KC Hart is the Director of Marketing & Communications for the Asheville HBA.

How to Choose a Homebuilding Professional

Today’s homes reflect changing market preferences and integrate elaborate designs and consumer desires into the construction of the homes. Your homebuilder must understand the home’s complex systems; pay close attention to detail; and coordinate a team of various contractors to build a quality product. To coordinate this process, your builder must be able to think on his feet, plan ahead and tackle a number of tasks simultaneously.

The quality of a new home will be determined by the skill of the building professional that constructs it. Evaluate your builder as carefully as you would select the features of your new home. When you buy a new home, you are purchasing more than just a structure - you are buying a package of services, and the quality of those services will have an important effect on your enjoyment of the house.

Of course, anyone interested in building a home wants quality work by a professional. Professionalism means different things to different people, but there are guiding principles by which homebuilding professionals conduct business. Building professionals believe that homes should be well designed, well constructed and well located according to the needs of their clients. They feel a responsibility to their customers and their community. They build high standards of health, safety and sanitation into every home.

One of the best ways to find out about the professionalism of a builder is to ask previous customers. Visit the builder’s previous communities and ask homeowners about their experiences. Content customers will recommend a builder to other prospective home buyers, dissatisfied clients will make home buyers aware of problems that arose during construction. Ask previous clients if the homebuilder discussed the construction process and building schedule with their customers. Also ask if they were able to tour the building site and ask questions about the status of their home.

Besides the questions of "how much does it cost?" and "when can we move in?," ask your builders a few standard questions. Does the builder offer a warranty program? Does the price include landscaping? What are the estimated taxes on the property? Are there any major development plans for the area in the next five years? You have a right to ask every question that you think is important. A professional builder will want you to be a happy and satisfied homeowner.

By doing preliminary homework, you will be able to shop for a builder with confidence, having the knowledge that will help you choose the right professional. For many people, buying a new home will be the largest purchase you’ll ever make. Make sure to protect that investment by building your home with a qualified, professional builder. Contact your local Home Builders Association, the Better Business Bureau, or the NC General Contractors Licensing Board for leads on licensed professionals.

KC Hart is the Director of Marketing & Communications for the AshevilleHBA.