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What Are the Benefits of Owning Your Home?

What Are the Benefits of Owning Your Home?

And now an obligatory post in which we showcase the many (perhaps obvious, perhaps not) reasons why it’s great to own your home. Yay! While we would never put down renting as an option for affordable living, especially in cities like Toronto or Vancouver, we do believe there are real benefits in home ownership for anyone in a position to buy. We could think of eight.

Here are 8 benefits to owning your own home

1 - Personal Savings

Some people are turned off the idea of owning a home because they don’t want to carry around a mortgage. But you can turn that mentality around by thinking of your mortgage as a personal savings account. When you make a monthly mortgage payment, you are essentially forced to contribute money into your own investment. You are paying down your mortgage, while your property is growing in value. When you rent, you are paying down someone else’s mortgage.

2 - Lifestyle Flexibility

If you’ve rented an apartment or condo in Toronto, you’ve likely experienced dealt with rules and regulations about how you can use and modify your home. No, you cannot put up wall paper. You don’t like these kitchen counters? Too bad. One of the most exciting benefits of being a property owner is that you have a lot more freedom to make any changes or improvements you want to your home. You can do what you want, when you want.

3 - Increased Net Worth

Who doesn’t want to increase their net worth? Increasing your net worth will directly impact your new investment and lending opportunities. And you might even get your name onto one of those fancy little net worth ranking lists. Owning a home increases your net worth, simple as that.

4 - Mortgage Insurance

Okay, this one may sound a touch lacklustre, but it’s a positive note about the financial reality of owning a home. It’s not really a BENEFIT, but we still felt like mentioning it as a useful bit of information. Mortgage insurance will pay for your mortgage if you lose your job or have a severe accident. Hopefully those things don’t happen, but it’s always nice to have a safety net.

5 - Security & Planning

One of the main responsibilities when “adulting” is having a firm hold on your finances. A key benefit of owning your home is that your monthly payments will be locked into a fixed term at a rate you can afford. Most often this is a five-year mortgage, which means you’ll know exactly how much you need to pay each month for the next five years. Unlike rental rates, which are constantly increasing.

6 - Improved Credit & Buying Power

Owning a home will help you build your credit score by regularly paying off debt. This improved credit will also give you more buying power, which is the total amount of money available each month after expenses. More buying power means you’ll have greater access to buying a larger home or moving into a more desirable neighbourhood.

7 - Future Income

A lot of people buy property as end-users. They find a condo or a house they love, and they make it their home. What a beautiful story! However, if you decide to move one day in the future, the benefit of owning the property is that you can rent it out. Not only will you be providing some lucky person with a home, you’ll also be making a steady stream of rental income. Cha-ching!

8 - Free Gains

And if the idea of being a landlord is something you’d rather avoid, you can simply sell the property, collect your cash, and walk away. As long as the property has been your primary home, you don’t pay any taxes on the capital gains (the amount that your property has appreciated in value since you purchased it) when you decide to sell.

You may also want to read:

These 10 Things Will Help You Become a First-Time Buyer

This is Why You Should Get Pre-Approved for a Mortgage