In this post, I will be sharing the 10 awesome benefits of buying a house in your 20s and why you should also consider homeownership. Buying a house while still young and within your 20s is like unlocking a great achievement.
However, very few take this instance of a big purchase as the whole process is sometimes challenging. Also, most people think they must be older to undertake such a task.
Although it may seem challenging at first, the benefits and advantages are worth it if you invest smartly.
10 Major Benefits of Buying a House in Your 20s
There are many benefits to owning a house at a young age, but here we will be looking at 10 benefits of buying a house in your 20s.
Enjoy More Freedom
Sharing your home with other people is a hectic endeavor. This implies that you have to consider their needs and concerns when deciding to change any property, but it will also mold your lifestyle to retain this partnership.
You will also have to get your landlord’s approval before you can rent out a room in the house to someone else. But in a case when you own your property, you can do all of those as mentioned above and even more without having to get anyone’s permission.
You can renovate your house whenever you want, and in whatever way you desire, nobody will interfere in your business and your choices; this is one great benefit of buying a house in your 20s and owning a home rather than renting.
Save on Monthly Rentals.
You do not have to pay monthly rentals to anyone when you live in your own house; buying and owning your own house will help you save up a sizeable portion of your monthly income.
Helps Improve Your Credit Score
Most people think that one’s FICO score is based on how one uses your credit card. But one’s credit history can also include other kinds of debt, such as mortgages.
Note that the more diverse one’s loans are, the better. At least 10% of your credit score is based on the type of credit you have:
- Retail debt
- Revolving debt
- Installment loans
- Home loans
Therefore, having a mortgage and making regular on-time payments can boost your score.
Potential Tax Reduction
Did you know that owning a property could lower your taxes? When you itemize the deductions on your federal tax return (instead of you taking the standard deduction), then one can write off the interest you have paid for the year on your mortgage.
But the savings do not stop there. other potential tax deductions include the following:
- Discount points: these are Points one paid to lower the interest rate on their mortgage
- Property taxes: Money one has to pay to the state and local county
- Energy-efficient home improvements: Example: New windows, appliances, a furnace, etc.
- Home office: when you are self-employed
For more opportunities or to know if you qualify, speak to a registered tax professional.
Feel the Sense of Being Grown-up
You will feel proud of yourself with enhanced self-esteem when you start building your path on your terms and conditions and taking full responsibility for your choices. So, when you buy and own a house, you tend to be more mature and a person who also takes life seriously.
You Will Learn Valuable Life Skills.
Owning and maintaining a property is a very big responsibility. There’s, and there’s, a lot more to it than what you may have experienced as a renter.
Financially, one has got bills to manage, such as:
- The mortgage
- Utilities such as gas, electric, water, sewer, trash, internet
However, one is also accountable for so much more. When you buy and own a home, you have to:
- Ensure the exteriors of the house is well maintained
- Handle any repairs. If you can’t do them yourself, you will have to find or hire a contractor who can.
- Upkeep the yard
- Make sure the property is safe.
As an adult in your 20s, this will be a growing experience. Not only will you come to develop your confidence, but you will also develop a greater pride in what you have accomplished so far.
You Can Make An Extra income.
You may decide to relocate to another city or shift to another house in the future due to certain reasons. In this case, you can decide to rent out your home and thereby make extra income every month from it. As property rates are constantly moving upwards, you will earn great revenue from your house or property sale in the future.
Achieving Financial Freedom
The good news or benefits of buying a house in your 20s or house ownership is that this can be one of your chances towards archiving financial freedom.
How is this possible?
Consider that immediately after your mortgage is being paid off; you will be rent/mortgage-free for the rest of your life.
This is no small accomplishment. Imagine what your life would be if you didn’t have to pay any extra $1,000+ monthly? Or think about how sooner you could potentially retire if your largest monthly expense (your mortgage) were now gone?
Profit Making Opportunity
Paying down the mortgage balance is not the only way to build equity in a property. If your house is in a very good location and is well maintained, then you can expect that, over time, it will appreciate.
Every Payment Builds Equity
Financially speaking, the biggest difference between homeownership vs. renting is something called “equity.”
A portion of any payment goes towards paying down the principal balance with a mortgage. The lower the balance, the more “house” you own. The portion or part of the house that belongs to you is your equity.
This is very important because you will most likely have to earn all of this money back when you decide to sell the property someday.
- You purchased a house for $250,000 and borrowed $200,000 from a bank for the mortgage.
- After many years of making payments, the remaining balance goes down to $150,000.
- Assuming you sell this house for exactly what you paid for it ($250,000), the proceeds will be used to pay off this $150,000 remaining balance. You will receive a check for the remaining $100,000 (i.e., your equity).
Equity contributes to your net worth.
What’s your opinion on the benefits of buying a house in your 20s? Kindly drop your view in the comment section below.
Watch this video to learn more
- 10 Best Mortgage Lenders in Florida for First-time Buyers
- 8 Best Ways to Be Financially Smart in Your 20s
- 20 best financial decisions to make in your 30s
- 5 Tips for Women to be Financially Independent After Marriage
- Top 10 Loan Apps that Works with Chime
- 10 Best Financial Planning Software for Individuals
- 10 Best Loans for the Unemployed in Nigeria
- 10 benefit of having a donation box at school
- $200+ Cash App Free Money Code 2022
- 7 Key Roles and Responsibilities of Finance Department in a Business