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Colorado Springs Real Estate
1. The chance to build equity.
Aside from having a roof
over your head, the ability to build equity is one of the most valuable aspects
of home ownership. Each monthly mortgage payment you make helps you to build
equity and brings you closer to owning your home outright. Home improvements
that increase the value of your property may also add to your equity. And, if
property values in your area rise, your equity will, too.
2.
Possible appreciation.
Most large purchases,
like cars, boats or electronics, go down in value as they age. Conversely, a
home usually increases in value over the years, especially if it's been well
maintained. And if your home's value has increased substantially by the time you're
ready to move, you may be able to profit from its higher resale price.
3.
Preferential credit options.
Once you build up equity
in your home, you can benefit from a new avenue of borrowing through home
equity loans and lines of credit. Home equity loans -- loans that are leveraged
against the value of your house -- are usually offered at a lower interest rate
than conventional loans because, with the house as collateral, they represent a
lower risk to the lender.
If you manage these credit sources wisely, they can become a valuable source of
funds for major purchases such as a new car, vacation property, home
renovations or emergency funds to use in the event of such things as a job loss
or unforeseen medical expenses.
However, because a home equity loan is secured
with your house, it's important to never borrow more than you can comfortably
afford to pay back. Otherwise, if you miss your payments, the lender could end
up taking possession of your home.
4.
Beneficial tax breaks
Home ownership does
require you to pay some extra fees, such as property taxes and interest on your
mortgage balance. But fortunately, both of these expenses are usually tax
deductible.
Borrowing against your home's equity may provide a tax break, too. Interest on
home equity loans of up to $100,000 are usually tax deductible. In addition, if
you've used your house as a primary residence for two or more years, you can exclude up to $250,000 (or $500,000 if you and
your spouse file jointly) in capital gains when you sell the property. (Check
with your financial advisor for advice on your personal tax situation.)
5.
Personal control
As a homeowner you can often exercise greater control over your housing costs
than renters. Also, when you own your own home, you have more freedom to
renovate as you choose without worrying about restrictions set out in a tenancy
agreement. Plus, any upgrades you make may eventually pay off by increasing the
resale value of your home.
6. Pride
of Ownership
Finally, home ownership has plenty of non-financial benefits, too. When you own
a home, it's yours; you can do what you want with it in terms of decorating,
gardening or renovating.
Remember, you not only own the house, but the land it sits on. There are few
things as empowering as knowing that there's a piece of the world out there
that belongs to you; a place you can truly call home.
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April 06, 2012 12:31:12
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August 24, 2011 12:31:27
Are You Ready to Buy a Home?By Michele Lerner Published August 15, 2011 | Bankrate.com
Are you ready to buy your first home? Buying a home requires a life plan and a financial plan. "Getting ready to buy a home should mean that the prospective buyers understand that there is more to homeownership than a housing payment," says Jim Walton, vice president of consumer credit with MetLife Bank in Irving, Texas. "Homeownership requires a commitment to a property and to a community." Long-Term CommitmentIn a hot real estate market, buying and flipping appeals to some buyers, but in a more stable or declining market, owning a home requires a longer time to build equity. "Even in the Washington, D.C., area, where our market is relatively stable, I counsel buyers to look at a minimum of a three- to five-year investment," says Leslie Wilder, a Realtor with McEnearney Associates in Arlington, Va. "In other markets, I think you need to own for a minimum of five years or longer in order to recoup the costs of buying and selling. If you are not able to make that commitment, you are better off renting." She also says: "Buyers need to think not only about what they want now, but also what they will want in five years. For example, if a couple wants to start a family, they might want to choose a home in a school district they prefer or to live close to work to shorten their commute." AffordabilityA lender can tell you the maximum mortgage you qualify for, but financial experts recommend that you determine your own upper limit for a housing payment. "A lender will look at your debt-to-income ratio, but at the end of the day you need to be comfortable with your mortgage payment and also prepared to save for other financial needs even after you become a homeowner," Walton says. "Buyers should take a disciplined approach to saving for a down payment, and then they need to be able to continue to save after they buy, for home maintenance and emergencies." Marc Schindler, a Certified Financial Planner and owner of Pivot Point Advisors in Bellaire, Texas, says he looks at real estate as an illiquid investment. "If you needed the cash from the sale of a home, it would take time to sell and cost about 7% of the home value for transaction costs," Schindler says. "I would recommend that no more than 25% of your asset allocation should be in real estate. For someone young with few assets, that may mean postponing buying a home until you can save more money." Interest RatesWilder says a good lender can talk to buyers about a variety of mortgage scenarios based on loan qualifications and size of down payment. "A lender should also talk to you about the impact of rising interest rates so you understand how much you can afford at different rates," Wilder says. "Buyers need to buy within their comfort level, so they may need to compromise on the home they buy. If they decide to wait to save more, they need to realize that if interest rates go up they may not be able to qualify for the same mortgage amount as they can right now." QualificationsA credit score of 720 to 740 is generally required to qualify for the lowest mortgage rates. FHA loan requirements are more lenient and sometimes lenders qualify borrowers with a score as low as 620 for these government-insured loans. "We generally look for a stable two-year job history, but we know people have lost jobs in the past few years so we are looking for a re-established job history if someone has been unemployed," Walton says. Home Prices and Rental RatesSchindler says potential buyers should research their housing market to determine whether owning is more affordable than renting or the other way around. In some markets, demand drives up rents, while a glut of homes for sale drives down prices. "A rent-versus-own calculator can be a good resource, but generally these will show you the maximum mortgage you qualify for at the best rates," says Walton. "Determining how much you want to spend on rent or a mortgage should be a personal decision." Responsibilities of Homeowners"Buyers need to make sure and factor in the maintenance costs of homeownership, which can run from 1 (percent) to 4% of the home value per year," Schindler says. "They need to realize that housing costs also include homeowners insurance, perhaps flood insurance and homeowner association dues, not just the principal and interest on the mortgage payment." Ready to Buy?"If you are a good, solid buyer financially, with savings, a steady income and job stability, and you can commit to staying in a home for the long-term, then the only thing to think about is whether you want to own a place to call home," Wilder says. "If all those pieces are in place, then it makes sense to buy now."
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Moving Up in a 'Down' Colorado Springs Market - What You Don't Know About Today's Real Estate Market in the Pikes Peak RegionLeave a Comment >
August 24, 2010 18:16:01
COLORADO SPRINGS, CO, Aug 24, 2010 - During the Great Depression of the 1930s, while most Americans struggled, there were some who also amassed vast fortunes. A wealth of opportunity also exists is today's real estate "recession," a time which offers buyers and investors in the Pikes Peak region an unprecedented chance to "move up," according to Joe Clement, Broker/Owner of RE/MAX Properties, Inc.. "Those who believe that real estate is a tide that moves all boats equally are just plain wrong," says Clement. "The fact is, we may very well be in the single greatest move-up real estate market in decades. Today's Colorado Springs market represents a rare opportunity for some to move up to their dream home at virtually unprecedented prices. If you have longed to move to another community, purchase a vacation home or create income through rental property, now might be your best chance to do so." According to Clement, the following facts rarely appear in media coverage about the Colorado Springs real estate market and are, therefore, unknown to most consumers:
Clement advises consumers to answer the following questions before considering a move-up home purchase:
"The answers to these questions are vital to making a more fully informed decision about the opportunities present in today's market," explains Clement. "A professional Colorado real estate agent, your attorney, financial planner and/or accountant can help guide you through this decision-making process." For more information, please contact Joe Clement at Joe.Clement@WeSellMore.net or 719-540-6421 |
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August 06, 2010 12:26:56
Interest rates are lower than
ever and tons of properties are for sale.
Here is an example of what this low
rate could mean to you: For comparison, the same loan
amount at 6.7%: That means over $278.15 is saved per month and over a 7 year period (the average length a homeowner lives in a home) the saving is $23,364.60! As you look at these numbers, you may have an "Ah-Ha" moment. However, these low rates will not last forever. That is why we want to tell everyone that NOW is the time to buy! We can help you take advantage of this unique opportunity. Contact us to learn more and let us help you navigate today's real estate market! Joe Clement, Broker/Owner RE/MAX Properties, Inc.
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