Owning a home is a longstanding foundation of the “American Dream”. However, that perception has decreased in the past decade due to the era of the Great Recession. According to a Washington Post survey, defining home ownership as a cornerstone has fallen from 78% to 61% over the past three decades.
Nevertheless, many benefits still exist for owning a home versus renting with the main advantage being building equity in the property. One of the benefits can be a reduction in your tax bill each year. Several items related to owning a home, such as the related mortgage interest, real estate taxes, and mortgage insurance, might be deductible if you itemize on Schedule A with your tax return. Interest rates for 30 year mortgage loans have been at historical lows for the past couple years, so comparatively it is a good time to obtain a mortgage. Be cautious of overpaying as many Americans experienced a significant decline in equity during the Great Recession period.
posyed by Myron D. Fisher, CPA, CGMA