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Home Ownerships and Investing Pays
No question about it, home ownership is a big investment, maybe the
largest you'll ever make. But over time, it's an investment that pays
for itself many times over. Here's how:
Tax Advantages
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Mortgage interest is tax
deductible.
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Real estate taxes are tax
deductible.
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Local tax benefits are
available in many areas.
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You can enjoy tax-free
gains up to $500,000 from the sale of a primary residence that
you have occupied for two of the last five years if you are
married and filing jointly. If you are single or married and
filing separately, you can enjoy tax-free gains up to $250,000.
Moreover, you can use the exclusion as often as you meet the
qualifications.
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1031 Exchanges for investment
purposes.
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Also placing real estate
in trusts, LLC or LC’s have other tax advantages as well. Please
refer to an attorney and tax consultant to educate yourself
with this issue. Choose a wise attorney who also invests in
real estate.
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You build equity over time,
which you can take out in cash when you sell your home or invest
in other real estate to build up your equity.
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You borrow someone else’s
money to purchase your investment. The banks want us to borrow
as long as we show that we can handle our money. If you can
handle where your money goes, then you can be a wise investor
in real estate. Check with your financial advisor if you are
not educated in this area. Make sure that when you do, that
they invest in real estate as well.
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The profits from home investments
are often greater than from many other forms of investments
unless you educate yourself to those other ways of investing
like in options, stocks or owning your own business.
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Because you can borrow
against it in most states, home equity can be a source of emergency
funding. You can’t borrow as much on stocks as you can on your
own home.
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Land appreciation adds
to the value of your home.
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For many, home ownership
is an important part of retirement planning.
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You gain more living space.
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You enjoy the satisfaction
and pride of home ownership.
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Home ownership, for many
people, is a sign of independence and achievement.
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As you buy investments,
your equity and assets grow, your wealth increases.
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