Celebrate the many benefits of homeownership
June is National Homeownership Month. Fittingly, as I compiled information for this column, my mind wandered to the first home we ever purchased.
My husband and I were filled with pride and joy as we moved our two children, two dogs and a cat into our new home. For the first time in our adult lives, we did not have to get a landlord’s approval to have our fur babies in our home. We could hang pictures anywhere we wanted, paint the walls any color we chose, and we were able to rip out all of the carpet and replace it with wood and tile that we chose.
My heart would get a little flutter every time I turned into my cul-de-sac and saw my stately home situated at the end of the street. We really felt like we had arrived and had achieved the American dream.
When I think of the many benefits of homeownership, the first that comes to mind is pride of ownership. That pride comes with the feeling of offering shelter and a safe place for one’s family.
There are several financial benefits that come with homeownership. Highlighted below are three major tax benefits.
First, as a homeowner you are able to deduct the mortgage interest and real property tax that you pay on your home each year. These deductions have evolved over the years and currently fall under the Tax Cuts and Jobs Act, which passed in 2017 and will stay in effect until 2025. These deductions can be taken on your primary residence and on loans up to $750,000.
The National Association of Realtors lobbies and fights for this benefit each time it comes up on the congressional chopping block because it is an important benefit of homeownership. There is no comparable deduction for non-homeowners on interest paid for acquired debt for goods purchased.
Second, as a homeowner, you also are afforded local and state tax credits from property taxes paid.
Lastly, homeowners benefit from capital appreciation. When you sell your home, you will not pay tax on the profit of the sale if you have lived in the home for two of the past five years of ownership. The tax-free capital appreciation is for a profit up to $250,000 for a single person and $500,000 for a married couple.
Equity in your home is another great financial benefit of homeownership. In most cases, homes appreciate in value over time. Equity is the value of your home minus the amount you owe. You can borrow against the equity. For example, you could send your child to college or make an improvement to your property. Gaining a financial edge as a result of homeownership is an important, although money is not the only benefit.
Homeownership brings intangible benefits as well. When you purchase a home, you gain a sense of community and belonging, pride of ownership, and a safe and stable place for you and your family to grow and thrive.
Virginia ended its stayat-home order on Wednesday. Are you ready to celebrate National Homeownership Month? The Hampton Roads Real Estate Market is heating back up, and your dream home is waiting for you.
You can share your homeownership story with the National Association of Realtors using the hashtag #CreatingHome when posting to your favorite social media platform.
Equity in your home is another great financial benefit of homeownership. In most cases, homes appreciate in value over time. Equity is the value of your home minus the amount you owe. You can borrow against the equity. For example, you could send your child to college or make an improvement to your property. Gaining a financial edge as a result of homeownership is an important benefit, although money is not the only benefit.
Christi Conroy is an associate broker with Berkshire Hathaway HomeServices Towne Realty in Virginia Beach and a Realtor with the Hampton Roads Realtors Association. For more on HRRA, go to www.hrra.com. Contact Conroy at ConroyHomes@ gmail.com or 757-422-2200.