Why Rent When You Can Buy a Home?

If you have never owned a home before, it can be a bit daunting. It is a commitment perhaps greater than leasing, but the rewards are high, so can outweigh any fears you might have.

It's not just about the money.....it's also about how you feel when you own your own home. You can enjoy your own home in so many more ways than you can a rental property. You can decorate & paint however you like, you can create a beautiful garden of flowers to enjoy, grow vegetables, have a dog with the security of a fenced yard, and you can build equity for your future. Sometimes, you will even save money when you buy a home because of the tax breaks/deductions you can receive.

Of course, this year until December 1st, there is an even bigger benefit - the $8,000 Tax Credit. This Tax Credit is only available on homes that close before December 1st. Basically, the program is as follows:

* First-time home buyers only on a primary residence (can not have owned a home in the past 3 years. If married, this applies to both spouses.)
* The tax credit does not have to be repaid (as long as you own your home for 3 years).
* The tax credit is equal to 10 percent of the home’s purchase price up to a maximum amount of $8,000.
* The credit is only available for homes purchased on or after January 1, 2009 and prior to December 1, 2009. (if you purchased a home between April 1, 2008 and December 31 2008, don't despair! You may still qualify for the previous $7,500 tax credit.
* Single taxpayers with incomes up to $75,000 (modified adjusted income) and married couples with incomes up to $150,000 (modified adjusted income) qualify for the full tax credit.
* Qualifying properties include Single Family Detached Homes, Attached homes such as Condos & Townhomes & Manufactured Homes.

For more information - http://www.federalhousingtaxcredit.com/glance.php

Beyond the $8,000 Tax Credit, there are several other factors that can make Buying a Home a great deal right now. Interest Rates are at amazing lows and there are many, many Affordable Homes on the market in our area - Austin/Lake Travis and the Marble Falls/Highland Lakes areas. The entire Central Texas Hill Country area around Austin has a lot of homes that are essentially On Sale!! These are two conditions that may not last long together and may not come around again, so it's time to take advantage of the market conditions and buy your own home.

There are other Tax Advantages to owning a home and the result is Savings! You will save money by taking deductions on your income tax for your interest paid on your mortgage and the property taxes that you pay. This can be substantial. By having these deductions available, you can either increase the number of dependents and thus keep more of your paycheck, or just get a tax refund at the end of the year. Either way, it's money in your pocket. As a renter, you get none of these benefits...you just keep paying and get nothing for it.

Another benefit to Home Ownership is the Equity that you will likely generate in your home. Homeownership is generally considered to be a Good Investment. For many, your home is your largest financial asset and a large part of your investment portfolio. Over time, home prices tend to increase on average 4.5% per year. That's a steady return over time. Yes, there may be years when the increase is less and years when the increase is more, but over time, the average is 4.5%. With home prices down slightly over the past, it's like buying a home on sale right now. Over 5 years, a $100,000 could appreciate to almost $125,000!!

The Federal Reserve Board estimates that people who own a home have net worths almost 36 times more than that of renters!!! The appreciation that you get on you home makes a big difference to your personal net worth. For instance, if your home has appreciated to $125,000 in five years, you will also have paid a portion of your mortgage principal down, as well, thus increasing your net worth to over $30,000 with a 5% loan.

Are you ready to be a Homeowner?

Pay your bills on time, keep your credit good, don't buy any new cars or large purchases when you are thinking of buying a home and check your credit report to be sure there are no mistakes or items which should have already been cleared. You can do this at www.myfico.com where, for $8.50, you can subscribe to Score Simulator Service. It will take your actual score and tell you actions that will raise it. You can watch their score increase over time by taking this advice. A higher credit score means you will get better loan terms and rates, generally.

So, What are you Waiting for??!! Not only in the Austin and Highland Lakes areas a great place to live, work, play and invest, it's a great place to buy Your First Home!

Contact us for a FREE COPY OF "Why Rent When You Can Buy?" , a publication of the National Association of Realtors.

Contact Sue Ellett at 512-422-7182 or Brooke LeMond at 512-284-0799 for more information about buying a home in the Austin or Highland Lakes (Marble Falls/Burnet) areas, today!

Sue Ellett, Broker-Associate
Paragon Property Group
Coldwell Banker United, Realtors
512-422-7182
sue@elletts.net