Wednesday, June 10, 2020 - by Brandi Pearl Thompson, president, Greater Chattanooga Realtors
June marks National Homeownership Month, which recognizes the value of homeownership and its positive impact on families, communities, and the nation’s economy. This month is a time to celebrate and help promote the American Dream of homeownership while pointing out the many benefits of owning a home. This column is one of a three-part series on “Why Homeownership Matters.” This week, let’s address how owning a home is a path to your financial stability.
Most consumers agree that homeownership is one of the best investments a person can make to begin building wealth. We know from studies that owning a home in certain zip codes can mean drastically different things including access to healthcare and access to a quality education. Having access to these amenities is part of the path towards financial stability. Homeownership provides social stability, builds communities, and is a driving force for our economy.
Often my clients are surprised to learn that they can put a down payment on a home that is about the same amount as a deposit on a rental property. And the financial benefits don’t stop there – purchasing a home is the first step in building equity. Over time, as the housing needs of your family unit change, you can upsize and downsize accordingly. You can use the wealth accrued from your current home and apply it towards a new home that meets your needs.
Compared to renting, purchasing a home is a way to limit in some ways, the impact of inflation. It’s not uncommon for rents to fluctuate with inflation, when purchasing a home, you have the ability to lock in a rate that remains the same for the life of the mortgage.
There are a lot of misconceptions out there about how much it takes to purchase a home. According to the National Association of Realtors' most recent Profile of Home Buyers and Sellers, renters who feel homeownership may be out of reach have options such as improving their credit score and managing their debt. While it’s perceived that a purchaser needs 10 percent or more to purchase, in reality, for first-time buyers in recent years, the report shows the median down payment to be closer to only six percent.
Our local market stats show a slow but gradual increase in median home prices, and we’ve seen this upward trend over the last 10 years. The sooner you invest in a home, the sooner you invest in yourself and your path towards financial stability for the long-term.
Sound a bit complicated? Try this. Think of owning your own home as an investment in not only your future, but your family’s future as well. Follow along for the remainder of June for the rest of this three-part series when we will discuss homeownership as an investment in your community and yourself both socially and emotionally.
Interested in getting started on the journey of buying your own home? Contact a Realtor. We have the tools and professional knowledge to help you walk this path. Realtors are here to be your housing resource. That’s who we R.