The rise in mortgage rates & mounting economic concerns have some people questioning: should I still buy a home this year? While it’s true this year has unique challenges, it’s important to think about the long-term benefits of homeownership before making a decision, according to reports from Keeping Current Matters.
If you know people who bought a home five, 10, or even 30 years ago, you’re probably going to have a hard time finding someone who regrets their decision. Why? The reason is tied to how you gain equity and wealth as home values grow with time.
The National Association of REALTORS® (NAR) says “Home equity gains are built up through price appreciation and by paying off the mortgage through principal payments.”
Even though home price appreciation has slowed lately, home values have still increased significantly in recent years.
Data from the Federal Housing Finance Agency (FHFA) shows just how noteworthy those gains have been over the last five years. Home prices grew on average by almost 64% nationwide over that period.
That means a home’s value can increase substantially in a short time. And if you expand that timeframe even more, the benefit of homeownership and the drastic gains you stand to make become even clearer:
Nationwide, home prices appreciated by an average of over 290% over roughly a 30-year span.
While home price growth varies by state and local area, the nationwide average tells you the typical homeowner who bought a house 30 years ago saw their home almost triple in value over that time. This is why so many homeowners who bought their homes years ago are still happy with their decision.
The alternative to buying a home is renting, and rental prices have been climbing for decades. So why rent and fight annual lease increases with no long-term financial benefit? Instead, consider buying a home. It’s an investment in your future that could set you up for long-term gains.
The bottom line? Don’t let the shifting market delay your dreams. Data shows home values typically appreciate over time, and that gives your net worth a nice boost. If you’re ready to start your journey to homeownership, reach out to me at 847.494.1102 & we’ll get you started. Karen Daugerdas, Coldwell Banker Real Estate Broker.