Loading

Is Buying a Home Still a Smart Plan?

Is Buying a Home Still a Smart Plan?
Updated on
March 24, 2021

With the burst of the housing bubble, credit crisis, and millions of foreclosures across the country, you may wonder if buying a home is such a good idea after all. However, it’s important to consider all of the facts. The important message to take away from these events is not that buying a home is a bad idea, but that you must be smart about buying your home.

The housing market, like every type of market, unavoidably has its ups and downs. That doesn’t mean buying a home is a bad investment. As a long-term investment, home-ownership is still one of the best investments for individual households. Historically, real estate has consistently increased in value, despite shorter periods of depreciation due to local markets and/or national economic conditions. The data shows that homes generally appreciate about 5% per year.

How is buying a home an investment?

Five percent may not seem like a great return on investment, but you have to think about it in the context of the situation. For example, let’s say you put 10% down on a $200,000 house. That’s a $20,000 down payment, or initial investment. At a 5% annual appreciation rate, your $200,000 home would gain $10,000 in value during the first year. Earning $10,000 on an investment of $20,000 is a whopping 50% return.

For further perspective, let’s say instead of spending that $20,000 on a down payment, you invested it in the stock market. With a 5% return, you would gain only $1,000 in profit.

The tax benefits of buying a home

So now you’re saying that a home may have a higher return, but that’s before you consider all of the costs of home ownership, such as taxes, etc. Well, think of it this way: your property taxes as well as the interest on your mortgage are both tax deductible. You can deduct those costs from your income, thus reducing your overall taxable income. In other words, the government is subsidizing your home.

Additional Benefits to owning a home

It’s easy to get carried away with all of the economic reasons for home ownership, but it’s important to remember that not every reason is financial. Have you ever wanted to paint the walls of your apartment? Well when you’re renting, you can’t. Has anything in your apartment ever needed updating, but the landlord refused to do it? When you own a home, you can make the space yours in almost any way you want. And you benefit when you do home improvements, both financially and psychologically. Homes generally have more space, for storage, living, etc. than other living arrangements. Not to mention that you have space outdoors for barbecuing, pets, and kids. Owning your home carries with it a sense of pride, accomplishment, and even an elevated social status.

So when you’re considering buying a home, consider the broad range of benefits that owning a home can have. And always make sure you have an experienced real estate agent and loan officer to help make sure you’re getting a home that is right for you, both financially and psychologically.

Schedule an Appointment

Additional Real Estate Blog Articles

Is Buying a Home Still a Smart Plan?
Home buyer tips
Whether your first second, or dream home, we find you the perfect property.
New Home buyer articles
We sell your home quickly & efficiently getting offers for your property.
First time home buyer articles
We find you the perfect office & commercial location for you.
Home buying help
Amazing Luxury Real Estate throughout Texas
Home buying help
Find the best residential, commercial & land investments.
Home buying tips
We help you relocate your home, business & life to Houston.
Home buying guide
Mortgages, Titles,  estates. Learn more about purchases.
Home buying articles
Contact us for help with your real estate sale or purchase.

Texas Real Estate Information & Categories

the right property, the first time
Find your next property

Contact us to find your next property. We find you the best beginner or luxury home or commercial & business real estate opportunities.

home for sale on, New luxury Construction in Texas, New builds in Cypress
For Rent
For Sale
Luxury Home Build in Cypress, TX
10931 Water Hyssop Lane
new luxury listing in Cypress Texas, new home build or sale in Cypress, Luxury real estate in cypress TX
3
Bedrooms
home for sale on, New luxury Construction in Texas, New builds in Cypress
2
Bathrooms
home for sale on, New luxury Construction in Texas, New builds in Cypress
For Rent
For Sale
New Luxury Home Construction in Cypress, TX
13811 Friarstone Pointe
new luxury home listing in Cypress Texas, new homes for sale in Cypress, Luxury homes in cypress TX
5
Bedrooms
home for sale on, New luxury Construction in Texas, New builds in Cypress
5.5
Bathrooms
12714 American Sweetgum Way, New home Construction in Texas, New Home builds in Cypress
For Rent
For Sale
New Home Construction
12714 American Sweetgum Way
ew home listing in Cypress Texas, new luxury homes in Cypress, Luxury homes in cypress TX
4
Bedrooms
12714 American Sweetgum Way, New home Construction in Texas, New Home builds in Cypress
3
Bathrooms
Contact Our Texas Real Estate Experts Today

Schedule a Free Texas Real Estate Property Consultation

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
10931 Water Hyssop Lane for sale Luxury home construction
For Rent
For Sale
Luxury Home Build in Cypress, TX
10931 Water Hyssop Lane
new luxury listing in Cypress Texas, new home build or sale in Cypress, Luxury real estate in cypress TX
3
Bedrooms
home for sale on, New luxury Construction in Texas, New builds in Cypress
2
Bathrooms
Luxury real estate for sale in houston
For Rent
For Sale
Newly Built Luxury Home
11706 BRANDON WAY
Houston luxury homes for sale
5
Bedrooms
Luxury real estate for sale in houston
5.5
Bathrooms
Beautiful home in the Grand Lakes Community!
For Rent
For Sale
Lake View Property
7602 HAMPTON BAY LANE
Luxury homes in Grand Lakes
4
Bedrooms
Luxury real estate in Katy TX
3.75
Bathrooms
Luxury Living in Timberlake Village!
For Rent
For Sale
Custom, One Owner Home
22918 TIMBERLAKE CREEK
Luxury real estate in timberlake village
4
Bedrooms
Homes for sale in timberlake village
2.5
Bathrooms

The Latest from the Walkthrough Blog

Pre move checklist
Moving can be incredibly stressful, but it doesn't have to be. With a little bit of preparation and planning, it's possible to streamline the entire moving process. Start by breaking down the move into manageable tasks and setting an overall timeline for when everything should be completed. Ready to create a stress-free plan for your move? Follow these tips from Pride Street Realty Group.
Home Ownership
Upsizing Your Home for a Growing Business
As a home-based business owner, it’s always exciting to watch your business grow and expand. But as your business grows, you may find that your home is no longer sufficient to support your needs. Whether you need more space for inventory, a dedicated home office, or a professional place to meet with clients, upsizing your home might be the solution you need. Moving into a bigger home is a major decision, so it’s important to plan your upgrade carefully. Check out the following tips to ensure your upsizing process goes as smoothly as possible.
Tips For Buyers
Understand Mortgage Processes and Paperwork
Buying or selling a home is an exciting period in everyone’s lives, but it can become overwhelming quickly, especially when it comes to keeping track of the paperwork. Misplacing documents can lead to closing delays or missed deals. To make sure you make it through the process as smoothly as possible, here are some helpful tips from Pride Street Realty on how to keep up with the paperwork that comes with the home buying and selling process.
Tips For Buyers
starting over in a new city
Embracing a vibrant new city can be an exhilarating prospect, especially if you've recently been through a hard time. Beginning anew in an unfamiliar place could feel overwhelming, however, which is why having a plan and smart advice is key for making the most of this fresh start. To help you out on your journey, Pride Street Realty has put together a few helpful tips that will make the process a little easier.
Tips For Buyers