What is Happening in the Mortgage Market

There are a number of personal and emotional reasons to buy a home.  Dallas and Fort Worth home prices are on the rise and sales are picking up according to this Star-Telegram article. But there are also some strong financial reasons to make the investment.

Here are just a few of those reasons:

Increase Net Worth: Few things have a greater impact on net worth than home ownership. When comparing renters to home owners, the Federal Reserve Board of Consumer Finance found that the average net worth of renters was just $4,000 compared to homeowners at $184,400.  That is huge!  Even Warren Buffet said that owning a home was the third best investment he made.

A Big Tax Deduction: One of the largest tax deductions available is the amount of interest paid on a mortgage. In fact, a $150,000 home at a 5.50% interest rate can add up to approximately $8,000 in first year's interest. This amounts to a significant savings – reducing the amount of  income tax one pays and effectively a homeowner's monthly mortgage payment.

Long-Term Appreciation: Over the last few years, home prices have corrected and become more affordable. While that's good news for potential buyers, it has overshadowed the long-term appreciation of a home's value. The reality is, despite market ups and downs between 1950 and 2002, US home prices appreciated at an annual growth rate of 4.8%. Even if you calculate a modest appreciation of 3%, a home purchased today for $150,000 will grow in value to $364,000 over 30 years.

Record Low Mortgage Rates: Yes you can get approved. Documentation requirements have increased but realistically, if you have decent credit and can verify your income - you can get approved. 

Richard Woodward
Banker / Senior Branch Manager,   NMLS ID 217454
Click here to view My Personal Brochure

 Office:  (972) 661-5136  

Visit Us Online - www.Envoy-Mtg.com

Texas Mortgage Banker Registration #45300  NMLS ID 6666