Friday, December 19, 2014 / by Glaiza Narvaez
WHAT MATTERS MOST TODAY?
December 19, 2014 by GLAIZA NARVAEZ
Summer may be real estate’s busy season, but winter offers great opportunities for buying a house, especially for renters looking to become homeowners, growing families trading up to larger houses and baby boomers seeking homes to fit their evolving lifestyles.
Your housing choices during the late fall are still healthy. October and November are great months to go house hunting. December is usually sparse, market-wise, but if that fits your timeline, you could luck out.
The benefits to buying a house at the end of the year include the following:
1. Tax savings
If you close by December 31, you can deduct mortgage interest, property taxes, and points on your loan and interest costs. These deductions are significant, especially in the early years of your loan when you are paying off a lot of interest.
2. Motivated sellers
Many sellers want to enjoy tax savings on the next home they purchase. They may accept lower bids in order to meet Uncle Sam’s deadlines. However, if you are in a strong seller’s market, you will want to be conservative and heed advice from your real estate professional.
3. Builder incentives
If you are buying a house that is brand new, there is a good chance builders may push to close the books on their year—and meet quotas. They may offer upgrades or little extras to sell houses before the calendar turns.
4. Available movers
Many moving companies are booked six weeks or more in advance during the busy summer months. In the fall and winter, it is normally easier to secure the services of a moving company or rental equipment on shorter notice.
5. Paying toward something you own
If you are renting, your monthly check goes toward something that will last you a month: You will never see any return on that money. When you buy a house, your monthly mortgage payment goes toward an investment—and ultimately a roof that is yours.
6. Consistent payments
7. Freedom to renovate
8. Gaining equity
In the beginning, most of your payment goes toward interest. However, gradually more will go toward paying off your principal, meaning you build up equity—or savings—in your home. Another factor in equity is appreciation: As home values rise, so does your rate of equity.