Owning a home is more than a great investment decision. It’s a tangible asset that serves a purpose. You need a place to live, and living in the home you own means you have stability – not only financially, but materially.
Homeownership is good for the short term, but it’s even better for the long term.
Take a look at the long-term benefits of homeownership in Winston-Salem.
Home Values Appreciate in Winston-Salem
Both the land your home sits on and the property itself will become more valuable as the years go by. You’ll make a certain amount of money if you own a home for five years. But, if you own that home for 20 years or 30 years, you’ll see the value of your asset increase over that time. The longer you hold onto your home, the more appreciation you’ll earn.
You also have the power to drive appreciation. Think about your property’s condition. If you don’t maintain it, the home will actually depreciate over time because it will deteriorate as it ages. But, if you keep up with improvements and upgrades such as new appliances, better windows, and increased curb appeal, you’ll be able to drive up what your home is worth.
Growing Equity in Your Investment
You also earn more equity when you hold onto your home for the long term. Every mortgage payment you make allows the balance of your loan to come down. Over time, as both the loan balance and the interest portion of the mortgage decrease, more of your monthly mortgage payment goes towards paying off the balance of the loan.
Selling your home after five years of mortgage payments will not deliver the profit that you’ll earn when you sell that home after 15 or 20 years of mortgage payments. If you manage to pay off the mortgage before you sell your home, you’re pocketing every dollar.
There’s an even bigger benefit when we’re talking about equity.
The more equity you have in the property, the more money you’ll have available if you eventually want to refinance to cash out some of your equity or sell in order to buy a larger property.
Using Your Winston-Salem Home for Retirement Planning
No matter how much you’re saving and investing, it can often feel like you’ll never have enough money for retirement. When it’s time to think about that stage of your life, you can downsize, putting the equity you’ve amassed towards your retirement nest egg. Research has shown that many people use their home equity as a retirement savings tool. When you buy a home, you could be preparing financially for your retirement, whether that’s 10 years away or 25 years away.
Here’s another benefit to homeownership: you could use that home as a rental property one day. Maybe you’ll move out of the area or buy another home. Perhaps you’ll move in with a family member or get married. Instead of selling your home, you can rent it out for additional income and ongoing appreciation.
We love talking strategy with homeowners and future homeowners. If you’d like to talk about any Winston-Salem real estate services you might need, please contact us at Capstone Realty Consultants.