National Homeownership Month is a great time to review the benefits and values that owning a home brings individuals and families. From creative freedom to update it inside and out to the lasting connections that homeowners make in their community, homeownership has many benefits that make the American dream so alluring. But what about financially? It’s true that homeownership, like any financial investment, is a big decision that shouldn’t be taken lightly. However, if you’re on the fence about homeownership, it may be helpful to know that real estate is still considered the best long-term investment.
Poll Results Show: Real Estate Still Considered Best Long Term Investment
A recent Gallup poll compared American’s opinions on the best long term investments in 2023. The poll included gold, stocks, CDs, bonds, and real estate investments. The results show that real estate comes in as the top long term investment and has for 11 years straight.
Why Homeownership is Always a Good long Term Investment
Homeownership Protects Against Inflation
You’ve probably noticed the cost of everyday items rising due to inflation, and real estate is no different. When you lock in a fixed-rate mortgage, you can budget around a stable cost of living. In contrast, when you rent, you may see hikes in rent during times of high inflation, making budgeting more difficult. Homeownership provides financial stability throughout those periods of uncertainty.
Property Values Increase Over Time
Your house is an asset that appreciates in value over time, especially in times of inflation. Even amid the current financial climate, most homeowners will see the value of their property increase from year to year. That’s why when considering which long term investment makes the most sense, homeownership tops the list.
Real Estate Allows You to Grow Equity
Home equity is the amount of your home you own versus what you still owe on your mortgage. Your monthly mortgage payments typically go towards lowering the balance you owe and, in turn, increasing the equity in your home. Those funds can be pulled through home equity loans, home equity lines of credit (HELOCs), or when you sell the house. When you invest in homeownership, you can rest assured that the cost of living paid into your home is going towards equity (and increasing your net worth) rather than not seeing a return on those funds like in rental agreements.
About Julie Krumholz from Superior National Bank
Julie Krumholz has been helping Michigan homebuyers for over 30 years and has several loan programs available for various incomes and financial situations. She’s experienced nearly every facet of the mortgage industry, from processing, closing, loan origination, underwriting, QC auditing, and even co-owning a mortgage brokerage firm. Julie uses her wealth of experience to match homebuyers with the best mortgage program for their specific needs and helps streamline the homebuying process.
