GETTING MARRIED? — CONGRAULATIONS!
NOW YOU CAN BUILD WEALTH
Brian DuBois, Broker/Owner/Partner, DuBois Realty Group
There is more to the dream of homeownership than just owning your piece of God’s good earth with a cute home surrounded by a white picket fence. There are many other benefits that a young couple may not know, but will come to appreciate (pun intended).
Let’s start with the eye-opening fact that the average net worth of a renter is only $10,400, compared to a homeowner’s at a staggering $396,000.
How can this be true? Let’s take a look:
First, real estate appreciates. This means when you own it, it will be worth more in the years ahead than it is today. While the market may ebb and flow, the average annual appreciation over the last 30 years is 4%.
While the property appreciates its value, the homeowner also pays down the principal on the mortgage. (In other words, the homeowner pays their mortgage while the renter pays the landlord’s mortgage.) As the principal decreases, the homeowner’s equity increases.
Then, we have the tax benefits of homeownership. In many cases, the homeowner can write off and deduct interest paid on a mortgage up to a specific amount, plus property tax benefits and private mortgage insurance.
When these three financial benefits of homeownership are added, your net worth will have increased significantly in the first year alone.
Example:
Home price: $325,000
Average appreciation rate 4%
Annual appreciation: $13,000
Mortgage amount: $308,750
Interest rate/Term: 7.25%/30 years
Principal paid 1st year: $2,988
Total interest paid 1st year: $22,286
Tax bracket: 22%
Tax savings: $4,903
Financial Benefits
Total savings: $20,891
While interest rates remain high compared to recent historically low interest rates, paying 7.25% for a mortgage toward homeownership is certainly better than paying 100% interest toward the landlord’s mortgage.
It’s never too early to engage your real estate professional regarding your goals, hopes, and dreams. Not only will you learn about current market conditions, buying strategies, and things to avoid, but they will also connect you with trusted lenders who will educate you on various loan programs and first-time homebuyer incentives.
When the time is right for you, your real estate professional will help you find a home that meets your needs, guide you through the home-buying process of making a competitive offer based on hard data and market trends, negotiate on your behalf, navigate through the home inspection process, and get you to the closing table.
Imagine buying a home AND improving your Net Worth by nearly $21,000 in one year? Start your path to building wealth through real estate today!
Note: Consult with your tax professional and/or lender for information about your specific scenario.
ABOUT THE PRO
Brian dubois, born and raised in Auburn, educated at Bentley University, and later employed as the Executive Director of the Auburn-Lewiston YMCA, Brian has in-depth knowledge of the greater Lewiston / Auburn area, the professional skill set of a community leader, and the interpersonal skills to facilitate smooth real estate transactions. Brian not only has genuine interest in the real estate market, but his desire to serve is a good fit for this industry—connecting families with a new home, guiding sellers through a thorough process, and providing investors with new opportunities.
Together with his wife and business partner, Marnie, they reside in Auburn where they are raising three children and two dogs.
Brian welcomes your inquiries regarding this subject matter, content suggestions, or questions regarding all things real estate.
207-344-3230
