All Posts Tagged: home value
Numbers count. They matter to bankers and to prospective homebuyers, sellers, and real estate professionals. Here’s my take on the key numbers on the housing market this week.The numbers: Survey on long-term value
A growing majority of Americans — 56% of adults — say that buying a home is an excellent long-term investment compared to 38% who believe that buying a home is no longer one of the best ways for people to build wealth, according to the How Housing Matters survey released June 9 by the MacArthur Foundation. This positive view of homeownership is in sharp contrast to findings in the 2013 survey when 57% of respondents said buying a home was becoming less appealing.
On the negative side, the survey also revealed that 61% of adults believe we are either “still in the middle” of the housing crisis (41%) or “the worst is yet to come” (20%). While an improvement from the 70% in 2014 and 77% in 2013 who were pessimistic, the results suggest “ongoing concerns about housing affordability as well as lingering economic trauma,” the report says.What counts: For those on the fence about the long-term value of homeownership, consider this: Home values rose fairly steadily for 31 years — from 1975 to late 2006, according to the Case-Shiller U.S. National Home Price Index. In the housing crisis, the national home price index bottomed in early 2012, and has been on an upward trend for the past three years. During and following the financial crisis, it was understandable to question the value of homeownership. And certainly, there is no certainty that a home’s value will increase in the future. But clearly the MacArthur Foundation’s latest survey shows more Americans are becoming increasingly optimistic about the long-term benefits of homeownership.
While many people focus on home appreciation, it is important to weigh the potential benefits and potential costs of homeownership. In some cases renting may be less expensive than homeownership, which comes with the added costs of property taxes, insurance and maintenance. Also, renters tend to be more mobile, able to relocate at the end of a lease, while homeownership comes with decisions about selling or trying to rent a property if you relocate.
On the positive side of ownership, having a place to call your own means you can fix it up, paint it, remodel it as you like. Also, there may be tax advantages to having a mortgage — though you should talk to a tax expert about your particular situation. Finally, you may build equity in a home as you make mortgage payments and as long as the value increases.Read More ›