Benefits of Owning a Home

Homeownership Provides Lasting Value

Owning a home is an admirable goal and a dream for many Canadians. It is an important milestone that many look forward to achieving. But beyond merely fitting in, why exactly should you own a home?

The concrete benefits of being a homeowner range from financial to emotional, and the impact can last for generations. Therefore, it is a vital step that you should take in order to set yourself up for a secure future.

Learn all about the 7 advantages of owning your home, which are listed below.

1

Build Your Equity and Grow Your Wealth

The long-term benefit of owning your own home is that your mortgage principal payments act as a forced savings account. When you pay off your mortgage, you are increasing your equity in your home, which translates to a growing asset that you can rely on.

If you were to rent in order to live independently, the money that you pay for rent will most likely be used by your landlord to pay off their mortgage. But if you were to own your home, that money would go towards increasing your home’s equity until you pay off your mortgage and fully own your own high-value asset.

Not only does paying off your mortgage loan increase your wealth, but your overall home value also grows as all property values go up over time. In the short term, the market may experience ups and downs, but over many years, real estate prices in Canada have and will continue to grow steadily. This means that real estate is much like a high-interest savings account that increases in value faster than inflation rises.

2

Use Tax Breaks and Benefits

The Government of Canada has created multiple financial incentives to help Canadians become homeowners and has provided many more tax deductions for homeowners to enjoy.

These benefits are helpful for homeowners who want to upgrade their home space with eco-friendly changes, make disability-friendly alterations, and allow for multigenerational living situations or work-from-home set-ups—many of which are not permitted options if you do not own your home.

Useful and relevant tax breaks include:

Home Accessibility Tax Credit (HATC): This tax credit is for home renovation or alteration expenses that allow eligible seniors and/or individuals with disabilities to be safe and mobile in their homes. It is 15% of up to $20,000 of eligible expenses, which is $3,000.

Multigenerational Home Renovation Tax Credit (MHRTC): This tax credit is for home addition or renovation expenses that create a secondary dwelling for a qualifying individual or qualifying family member to live in. It is 15% of up to $50,000 of eligible expenses, which is $7,500.

Home Office Expenses Tax Deduction: Employees who work from home can claim the expenses used for their home office. These include utilities, internet, and maintenance for salaried employees and home insurance, property taxes, and technology for commission employees.

CMHC Eco Plus Program: Under this green program, homeowners can apply for a 25% refund of their CMHC mortgage loan insurance if their home has an eligible energy efficiency certificate or has received an EnerGuide Renovation Upgrade Report.

3

Count on Long-Term Stability

You can expect financial and housing stability when you purchase a home rather than rent one. Under a fixed-rate mortgage, your housing costs will be locked in place for several months to several years, making it easier for you to make long-term financial plans. More often than not, buying will cost less than renting over a long period of time.

If you were to rent, you would live under the rules of a landlord who could raise the rent or evict you with proper notice if they needed the home to live in or sell. You would then be thrown back into the rental market, with its rapidly rising prices and low vacancy rates that could make it difficult for you to live in your preferred neighbourhood.

You can create stability in your life and not have to worry about being evicted by a landlord or having your rental costs increase. By owning your own home, you can fully settle down in a neighbourhood and commit to a community, which can equate to much-needed stability for you and your family.

4

Have the Freedom to Personalize

With your own home, you can decorate how you want and add upgrades whenever you choose. Your interior design choices can be as simple as painting the walls in your desired colours or installing deluxe additions that cater to your hobbies and interests. For example, you may invest in top-of-the-line kitchen appliances so that you can create chef-inspired dishes every day, turn your entire living room into an immersive entertainment centre, or replace your standing shower with a full-sized tub for a spa-like experience. You can also have as many pets as you want or plant a large vegetable garden without worrying about arbitrary rules set down by a landlord.

5

Enjoy the Pride of Homeownership

Something that cannot be measured but can most definitely be felt is the feeling you get when you own your property. Homeownership can represent many things for many people: the freedom of living on your own, proof of financial independence, long-term housing security, a safe place to express yourself, and a hub for inviting loved ones to share.

Once you own a property, you can also care for it: maintaining it beautifully, upgrading it with features that enhance your life, and adding decorative touches that make it feel like home. Together, these aspects form the uniquely satisfying feeling of homeownership that is harder to achieve when renting.

6

Secure the Future for Yourself and Loved Ones

You can prepare for retirement and leave an inheritance to your children simply by owning real estate. After paying off your mortgage loan, you will own your home outright, reducing your housing costs. You can then choose to use a combination of your savings and your home equity to fund your retirement, which is something you cannot do if you continue to rent into your golden years.

Additionally, your home is an appreciating asset which will continue to grow in value over time. This means that when you are ready to pass it on to your children, it will be extremely valuable and useful. They can choose to sell it, live in it, or rent it out to generate passive income. Real estate is an important tool for creating generational wealth, which means that your home investment today will impact your children’s future for years to come.

7

Handle Financial Challenges with Flexibility

With a growing and tangible asset like real estate, you can count on having a financial cushion in case of emergencies or unexpected challenges. Homeowners can turn their home equity into cash by applying for a home equity loan or line of credit. This can be a great relief in case of financial stress, and it is usually less expensive than using a high-interest credit card. You can also use that home equity loan to buy another property and build your portfolio.

You can also renegotiate with your mortgage lender if you are temporarily unable to meet your regular mortgage payments. Many lenders will work with you to find a solution to briefly pause or lower your payments by changing your mortgage terms. This makes it easier to face life’s challenges than renting and having little to no security to fall back on.

Have questions. Feel free to call Stan at 604-202-1412

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