How do you Benefit from Home Ownership?
Principal Pay Down
- Unlike your rent payment, mortgage payments include a principal component that otherwise brings your total monthly mortgage balance owing down and resulting in an increase of your equity.
Appreciation
- Appreciation refers to the increase in your home’s value over time. Your value may increase for a number of reasons, including interest rate fluctuations, supply and demand, inflationary periods, and even due to emotional house shoppers.
Cash Flow
Whether you’ve purchased a stand-alone rental property or have a rental component to your home, this secondary source of income, ideally above and beyond your total monthly bills, provides great value. For Example
- Rent = $2,500
- Mortgage = $1,500
- Expenses = $500
- Cashflow = $500
Sweat Equity
- Sweat equity refers to the physical improvement of upgrading your home through renovations.