The American Dream of owning a home is more important than ever when you consider all the implications of renting—and how much better home ownership can prove to be for your bottom line and your peace of mind. Below, we explore six reasons you should seriously consider putting a plan in place to make 2018 the year you take the plunge and purchase a home of your own.
You’ll almost certainly grow your net worth by leaps and bounds
When you rent a home, you’re spending money in the literal sense—once you write that rent check every first of the month, that is cash you’re permanently kissing goodbye. (All the more frustrating is the fact that your money is, meanwhile, helping to grow someone else’s wealth.) On the contrary, when you own a home, you’re investing money with every mortgage payment, and if you play your cards right, you’ll not only see that money again in some way, shape or form—you’ll see a great deal more of it. As simple as all this is, is it any wonder that homeowners are, across the board, significantly wealthier than those who merely rent?
According to a recent survey that was published by the Federal Reserve, the average net worth of U.S. homeowners is 44 times greater than that of U.S. renters. What’s more, between 2013 and 2016, the median net worth of U.S. homeowners increased by 15% to $231,400—but during the same period, the median net worth for U.S. renters dropped to $5,200, a 5% decrease from the 2013 median, which was $5,500. All of this data is compelling support for the notion that homeownership remains the safest and most strategic way to grow one’s wealth.
You’ll also reap previously out-of-reach tax benefits
Along with growing your wealth by effectively saving your money every time you make a payment on your mortgage, homeownership means reaping certain tax benefits that are not a consideration for renters. For one thing, when you’re a homeowner in 2018, you can deduct interest expenses on up to $750,000 of mortgage debt from your income taxes. What’s more, when your home increases in value throughout the course of your ownership, the gains are not taxed at the federal level—you can exclude up to $250,000 in home appreciated when calculating your capital gains.
You can take a big, deep breath of fresh air … literally
It isn’t just that you’ll be likely to spend more time in the sunshine when “outside” means your very own private backyard—a distinct upgrade over that balcony! It’s that, often, living in an apartment can present its own unique set of obstacles standing in between you and clean, healthy air. And although that may initially sound difficult to believe, consider the little-known fact that indoor air pollution levels can often be higher than outdoor air pollution levels. Think about it: everyday dust, household chemicals and other potential pollutants are relatively trapped indoors, making air circulation—which, depending on your apartment’s layout, may be nearly impossible—absolutely essential to a proper quality of life. Generally speaking, apartments don’t have nearly as many windows as do traditional homes, and with so many neighbors in such close proximity, opening a window for an extended period of time isn’t always an option. This issue is further compounded if you’re talking about city apartment living, because in that instance, it’s not simply nosy neighbors you have to consider before cracking a window to let some fresh air in. It’s also the passers-by smoking cigarettes, the flyaway dust from all the street traffic, and the exhaust from all the cars. Talk about a no-win situation.
You can boost your happiness
It should come as no surprise that having a full-fledged home—a place of your own that is really and truly yours—can dramatically boost your happiness and overall mental health. After all, when you have a personal sanctuary that satisfies your needs and the needs of your family, it just feels good. The pure desire to own one’s own residence, as was recently divulged in a survey conducted by the NAR, remains the number-one primary reason for purchasing a home. Other top contenders? The need to relocate for a new job, the desire to be closer to friends and family, and the longing for more space.
You can harness the power of color
When you’re living in a rented apartment, sure, you could, in theory, paint those boring white walls in the bedroom a rich and relaxing turquoise hue, a move that would undoubtedly infuse the room’s esthetic with a dose of sophistication and style in a seemingly easy fashion. But unless you’re fine with relinquishing a good chunk of the security deposit you paid when you moved in, if you do paint, you’d better be ready to return said walls back to their original pallor when the time comes to move out. If you’ve ever taken the time to paint vibrantly colored walls back to white, then you already know this task is neither easy nor fast (nor inexpensive, considering the many coats of paint the job will require). And if the original color of the walls was not white, but a more specific neutral hue? Well, in that case, you’d better hope there’s some extra paint lying around, because getting the shade just right is going to prove difficult if there isn’t. And the last thing you want to do is give the landlords any reason not to return your security deposit in full.
With all that in mind, it’s tough to make a case for making any major moves with paint in a rental. But when you own your own home, barring any HOA rules that prohibit your options in the way of color (and those tend to apply more so to what you to do the exterior of your home) the world of colorful paint and serious décor is your oyster. And, when you consider all the psychological effects being surrounded by your favorite colors can take, painting your home in a way that’s cognizant of the psychology of color, and harmonious with your own personal style, is a complete no-brainer. A quick guide on how color can impact the style and mood of your home:
- Red hues can induce hunger (now you know why you see them often inside restaurants). Unsurprisingly, they can also create vibes that scream passion and romance, making them a solid choice for your bedroom too. Just be careful with your accent colors: the combo of red and black can easily be perceived as angry—a feeling you’re likely not looking to achieve in any room of your house.
- Shades of orange are said to feel friendly and inviting, and if you get the shade just right, can look incredibly chic in a regal, unexpected way. (Think of the Hermes brand and that iconic shade of orange—it conveys luxury and opulence in a nanosecond.) If you get the shade wrong, that could be tragic, so when in doubt, consult with a color professional, who will likely blow your mind with her ability to pair unexpected colors (even oranges) with others in a way that looks impeccably elegant.
- Given the cheery feelings they’re known to encourage, a yellow hue is a great choice not only for a kid’s room, but also for a small, dark area, like a hallway. A soft, sherbet-y pastel is always a surefire way to add a little warmth and vibrancy.
- Green and blue shades—the former of which will prove to be a touch more versatile—create feelings of peace and tranquility, rendering them well-suited for the bedroom or even a master bathroom, where they’ll add another layer of relaxation to a soak in the tub.
- With some of the best things in life, a little goes a long way, and such is the case with colors in the violet family, which can be great at the proper saturation levels and disastrous when used in a manner that’s heavy-handed. A nice lavender can be a great alternative to pink for a little girl’s room, and a rich aubergine accent wall, accessorized with gold accents, can turn a boring living room into a stylish gathering area you’ll want to show off immediately. As is the case with other tricky shades (like oranges) we advise that you work with a design professional to determine the right hues and the right placements for anything in the violet family.
You can experience the bliss that is creative expression
We touched on the bland, boring pain of stark white apartment walls—so while we’re on the subject, can we talk about standard-issue window treatments you’ll find in most rentals? Basic vertical blinds, while functional in the sense that they do, in fact create privacy while keeping out a certain amount of light, are a surefire way to sabotage even the cleverest design efforts. To put it bluntly, they’re ugly. Sort of like the no-frills linoleum that adorns many an apartment kitchen, the beige carpet that seems to show wear and tear no matter how clean or even new it is, and the stock socket covers and light fixtures. If you bought a home that was decked out with all these dismal materials and finishes, chances are you’d plan a systematic upgrade, but when you’re living in an apartment that you don’t own, such an effort is incredibly tough to justify.
Unless you’re at the point where you can freely negotiate these matters with your landlord (e.g., you’re installing custom drapes to replace the vertical blinds and have gotten confirmation that you can deduct the expense from next month’s rent since the upgraded material will ultimately enable the unit to command a higher rent for the next tenant) it’s highly unlikely you’ll ever see any money you put into your apartment for materials like better window treatments, prettier fixtures and the like. On a similar note, it’s hard to argue in favor of buying investment furniture for an apartment.
Given most apartments’ specific layouts and dimensions, you’d need to buy pieces that fit perfectly for the place you’re renting—which may not work so well in whatever place you wind up calling home next. Also, that gorgeous expensive living room couch simply isn’t going to look as chic when the window behind it is clad with dingy rental blinds. Just like waking up in the morning and putting on clothes that convey your own personal sense of style makes you feel good, and makes you feel like yourself, having a home whose furniture and décor you have curated will prove incredibly fulfilling. It’s yet another reason to contact a trusted real estate professional today to establish a plan for taking the plunge and purchasing your first home!