Homeownership Is an Investment in Your Future
There are many people thinking about buying a home, but with everything affecting the economy, some are wondering if it’s a smart decision to buy now or if it makes more sense to wait it out. As Bob Broeksmit, President and CEO of the Mortgage Bankers Association (MBA), explains:
“The desire for homeownership is strong. Many prospective buyers are waiting for the volatility in mortgage rates to subside, as well as for a clearer picture of the economic outlook.”
If you’re in that position, remember that it’s important to consider not just what’s happening today but also what benefits you may gain in the long run.
Homeownership is often lauded for its ability to help build a homeowner's net worth over time. Today, many people think first about things like 401(k)s before they think of owning a home as a wealth-building tool. Homeownership is a key way to invest in your future, especially if you're a young homebuyer. An article from Bloomberg notes:
“Millennials have higher average 401(k) balances than Generation X did when they were the same age, but they're not any better off financially. . . . A lot of that has to do with being less likely to own a home.”
People who own homes experience several benefits that follow them throughout their lives, as the data demonstrates. The same Bloomberg article helps show the gap in wealth between renters and homeowners who are 65 years and older (see graph below). The difference is substantial, even when incomes are similar.
It may be time to prioritize homeownership if you want to create wealth and set yourself up for success later on. You'll always have a monthly housing expense, whether you choose to buy or rent a home. You have to ask yourself: Do you want to invest in your future, or hand over your money to someone else (your landlord)?
Before you make any decisions regarding your homeownership plans, speak with one of our experts. They will help you determine what the best decision is for you right now, and how to make the best investment in your future.