Invest in Yourself by Owning a Home

Are you pondering the wisdom of purchasing a home at this moment? Although today's mortgage rates might appear somewhat daunting, here are two compelling reasons why it still makes sense to consider homeownership.

Home Values Appreciate Over Time

There has been significant uncertainty regarding recent developments in home prices over the past two years. While they experienced a slight dip in late 2022, this year they have been appreciating at a more typical rate, which bodes well for the housing market. Although short-term price fluctuations can be concerning, historical data demonstrates that, in the long run, home values consistently increase (refer to the graph below):

By examining data spanning the last six decades from the Federal Reserve, it becomes evident that the prevailing trend has been a consistent and steady increase in home prices. While there was a notable exception during the housing crash of 2008, causing a temporary deviation from the norm, the overarching pattern reveals a continual appreciation in home values.

This persistent growth in home values underscores one of the compelling reasons why opting to purchase a home can be more advantageous than renting. As home prices continue to ascend and as you gradually pay down your mortgage, you steadily accumulate equity. Over time, this burgeoning equity not only bolsters your financial worth but also enhances your long-term financial stability.

Rent Keeps Going Up Through the Years

Another motivating factor to consider homeownership over renting is the relentless and recurring pattern of rent escalation. If you've ever experienced the burden of enduring yearly rent increases, you're in good company. This is due to the fact that rents have exhibited an enduring upward trajectory over the past six decades, as depicted in the graph below: