Following her article on why you should rent, Lea Jacobs looks into the pros of buying your own place.
No matter which way you twist or turn it, investing in your own property is always going to pay off in the long run.
Prophets of doom are undoubtedly looking at the latest interest hike and are delaying the decision to buy a home, but is this wise and will the delay make things any easier in the future?
The short answer is probably not.
Remember that interest hikes affect everyone and although homeowners will be paying more for the privilege of owning their own home, so too will buy-to-let investors and obviously the increased interest rate will also affect those who are renting property.
Their are numerous, very solid reasons why buying a home is regarded as a good investment.
Firstly, the returns when the property is sold are generally much higher than any other form of investment. That said, it has to be noted that, generally speaking, those who wish to make the most out of the deal do not view property ownership as a short–term investment and although there may be exceptions to the rule, most will only see seriously good returns after owning the property for five years or longer.
With that in mind, it is important to buy a property that will suit your needs for some years to come. In other words, while that bachelor flat may seem ideal to those who have recently married, factors such as when the couple plans to start a family should be taken into consideration before buying.
Secondly, owning your own home affords the owner more security than those who rent. Yes, the bond may be affected by the odd interest rate hike, but this figure won’t equate to anything near the average 10% annual rental increase.
Similarly, the homeowner can remain in his home for as long as he likes, he can renovate, extend and make overall improvements and not only add to the overall value of his home, but also adapt the property to his own requirements.
As humans we all want a bargain and while this is perfectly understandable, waiting for that bargain–basement property to come along under the current market conditions is pretty unrealistic. While there may still be ‘really’ good buys out there, these are becoming fewer and farther between.
This does not mean that there are not great buys out there, it just means that buyers need to educate themselves as to the average selling price of the type of home they are looking for. Property prices don’t only vary from suburb to suburb, they can, in certain cases, change significantly from road to road.
Today’s agent has the right technology on hand to show buyers what has been sold recently, and what the average price a buyer should expect to pay for a home in his location of choice.
Remember, buying a home isn’t only about finding a home that fits in with all your needs, it’s making an investment in something that will yield a maximum profit when it comes time to sell. This is certainly more difficult to achieve when the buyer paid too much for the property in the first place, so choose wisely.
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