I have been in an apartment for several years now and am thinking of buying a home again. Just curious if more knowledgeable about the market people have any comments.
If I do get something I’d prefer a townhouse or condo because I really don’t want a yard and don’t care for the suburbs.
From my understanding with the recent tax bill, a lot of the incentives for average folks to own a home are gone.
With the removal of the very few regulations put in place after the 2008 collapse, it’s very likely there could be a repeat.
I am 50 so by the time it is paid off (if I last) and I can focus on wealth building I may not really be able to enjoy it.
I am in the Houston area and a lot of what I have seen are quite a bit out of my range
I enjoy what I do and where I am but have been keeping my eyes open for opportunities. I like the idea I can move easily but I haven’t found or seen anything to encourage me to relocate, but I am being very picky about it.
You can still deduct mortgage interest up to $750k. And a compelling tax advantage is that $250k of appreciation ($500k for a married couple) on your primary residence is free of capital gains tax.
But I really think other considerations should come first in thinking about this. Selling up & moving home is incredibly stressful and expensive. So personally I’d never consider buying unless I’m sure I’m settled in a place for at least a decade. The other side isthat, psychologically, a rental never feels like “home” in quite the same way. So if you are sure you are settled and committed to a location, it’s great to have a place that’s really your own, and where you can improve it just the way you want, plant the garden and watch the plants grow and mature, that kind of thing. You can’t put a $ value on that.
If you are looking to stay put for the life of your mortgage, are looking at monthly payments (mortgage + association fees etc) that are similar to your rent, and you are interested in accumulating some value, then yes. And, in a general, non-location-specific sense, I don’t think you can get any more specific advice than that.
If you’re not going broke to achieve it, property ownership is, in the long term, always a better financial option than renting (given similar monthly costs).
That said, I’d be hesitant to buy property in low-lying coastal areas.
Since the standard deduction doubled, the value of itemized deductions is a lot lower for most people, since they won’t have more to deduct than the standard one anyway.
Take a look at the growth of housing prices in your area. Are they at historic highs, and are they still rising. Ask an agent about whether sellers are getting their asking price or having to negotiate downwards. That shows the weakness or strength of the market. Also, check on the inventory and days on market numbers.
If you can find an acceptable house that has been on the market for a while - and you need to check why it isn’t selling - you can negotiate a decent deal.
Owning versus renting is a personal decision. I prefer owning by a lot, and it has made me a lot of money. But it might not be for everyone.