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How Home Ownership Affects Children

June 11, 2025

How Home Ownership Affects Children

When families consider buying a home, the focus is typically on the financial benefits and investment potential. But homeownership also plays a meaningful role in the well-being of children. Studies show that children raised in owner-occupied homes experience greater stability, better educational outcomes, and stronger community connections.

Stability and Routine

One of the biggest benefits of homeownership for children is stability. Renting a home can come with frequent moves, school and extracurricular activity changes, and disruptions in routines. When families own their home, they’re more likely to stay in one place longer. This consistency gives children the opportunity to form lasting friendships, develop strong relationships with teachers, and participate in extracurricular activities on a consistent basis.

A stable environment can also help children feel more secure. Knowing they’ll come home to the same place every day provides a sense of comfort and predictability, which can contribute to a child’s emotional development.

Academic Performance

The stability and support that homeownership offers can lead to improved focus and school engagement. With fewer moves, children are less likely to fall behind or experience gaps in their learning. A consistent home environment can also encourage better homework habits and increased communication between parents and schools.

Parents who own their homes are more likely to invest time in their neighborhood schools and take an active role in their child’s education. This can have a direct impact on a child’s overall success in school.

Community and Belonging

Children benefit when their families are connected to neighbors and community organizations. Staying long-term in one area allows families to build relationships and feel a stronger sense of belonging. For children, growing up in a tight-knit community can increase confidence and provide a valuable support network.

Healthy Living Environment

When families own their homes, they have more control over the quality of their living environment. Homeowners can make improvements, maintain safety, and create a space that reflects their family’s individual style and needs. This is especially important for children, whose development is influenced by their surroundings.

A Foundation for the Future

In addition to the immediate benefits, homeownership can shape how children view responsibility and financial planning. Watching their parents pay a mortgage and care for a home can instill important life lessons about independence and long-term planning. For many children, this exposure becomes a foundation for their own future financial decisions.

Strategic Sales and Marketing offers a variety of real estate sales and marketing services. Our team has years of experience working with the real estate industry and understands the steps required to identify and connect with potential buyers. Please contact us for more information about our services.

What is the Difference Between a Buyer’s Agent and a Seller’s Agent?

January 27, 2025

What is the Difference Between a Buyer’s Agent and a Seller’s Agent?

Navigating the real estate world can feel overwhelming, especially if you’re new to buying or selling a home. It’s important to understand the roles of the professionals that help you throughout the process. While most people understand the roles of a mortgage broker or loan officer, it can be a little harder to discern the difference between the buyer’s and seller’s agents. Both are licensed real estate professionals but their roles and responsibilities differ depending on who they represent.

Choosing An Agent

Whether you’re buying or selling a home, it’s important to work with an agent you can trust. The agent you choose should have plenty of experience and understand your local market. It’s also important to find an agent that’s easy to communicate with. Agent’s play a crucial role in making transactions smooth and successful. A good agent will make sure their client is well represented throughout the process.

Buyer’s Agent

The goal of the buyer’s agent is to advocate for the homebuyer’s best interests throughout the buying process. Before hiring a buyer’s agent, you will be asked to sign a Buyer Agent Compensation Agreement or BRBC form, which is required by the California Association of Realtors. This agreement essentially “hires” the agent for an agreed upon fee to help them find and purchase a home. Once hired, the buyer’s agent curates a list of properties based on the homebuyer’s preferences including budget, location, and space requirements. Once the homebuyer decides on a property, the buyer’s agent prepares the offer with the terms specified by the buyer. They help negotiate with the seller or seller’s agent to get the best price and terms possible for the homebuyer.

The buyer’s agent assists with all parts of the buying process from negotiating with the seller’s agent to ensuring the buyer accurately completes and understands all paperwork.

Seller’s Agent

A seller’s agent, sometimes called a listing agent, helps the seller market their property, attract buyers, and secure the best terms of sale. The seller’s agent helps a seller determine the best asking price by providing a Comparative Market Analysis of the local area’s recent sales. Pricing a home correctly is vital to attract local buyers while maximizing profit for the seller. The seller’s agent assists with marketing the property and provides advice on staging and best practices for online listings and open houses. They make sure the property gets as much exposure as possible.

The seller’s agent helps screen potential buyers to ensure they are financially capable of purchasing the property. They negotiate terms with the buyer’s agent, and oversee the paperwork and deadlines to ensure a smooth closing process.

Is It Possible for One Agent To Do Both?

While it is possible for one agent to act as both the buyer’s and seller’s agent, this isn’t always beneficial for all parties. A dual agent must remain neutral, making it difficult to properly advocate on either party’s behalf. This can lead to less than favorable results for both the buyer and the seller.

Referring Agent

In a new home purchase, a buyer’s agent will act as a referring agent. They will help buyers to locate properties that may work with their budget and their desired wish list, some resale and possibly new homes. When a buyer purchases a new home, the agent that helped them find it may receive a referral fee to offset from the builder/seller that is credited toward the agreed compensation signed within the Buyer Agent Compensation Agreement or BRBC.

A referring agent is not a party to the sales transaction, nor do they have any requirements tied to Real Estate Agency. The new home sales representative plays that role in the purchase transaction. This is due to the specialized forms and disclosures that come with a new home rather than a used, resale home.

Mortgage Rates Reach Lowest Level in Over a Year, Offering New Opportunities for Homebuyers

August 21, 2024

Mortgage Rates Reach Lowest Level in Over a Year, Offering New Opportunities for Homebuyers

In August 2024, mortgage rates hit their lowest level in over a year. According to Freddie Mac, the current rate for a 30-year fixed mortgage has had a significant drop from nearly 8% last year. This decline presents a promising opportunity for potential homebuyers and sellers.

Falling Mortgage Rates Boost Affordability and Market Activity

Currently, the 30-year fixed-rate mortgage hovers around 6.5 percent, with rates expected to continue to decline in coming months as inflation decelerates and we enter into the election. For buyers, reduced mortgage rates could mean lower monthly payments and increased purchasing power, making owning a home more attainable. Some Sellers are offering 2/1 temporary interest rate buydowns, which drop the start rate to 4.5% the first year, which provides amazing savings for homebuyers. Sellers could benefit from heightened market activity as lower rates attract more buyers, leading to quicker sales and competitive offers.

Recent data highlights a resurgence of interest in the housing market, particularly in Los Angeles and Orange County. Over the past few weeks, there has been a noticeable increase in foot traffic at weekend new home sales offices and open houses. Lenders are also seeing a rise in clients reconnecting to explore financing options.

HPSI Data Confirms Increased Consumer Confidence in Real Estate

The latest data from the Fannie Mae Home Purchase Sentiment Index (HPSI) reveals a positive shift in consumer confidence within the real estate market. In June 2024, the HPSI rose by 3.2 points, reaching a score of 72.6. This increase represents a modest but notable resurgence of optimism among consumers about both buying and selling homes. 19% of respondents now view the current market as a favorable time to purchase a house, while a substantial 66% believe it is an advantageous time to sell.

Sales Surge and Inventory Expansion

The MLS reported a 3.9% increase in the number of homes sold from June to July 2024. This rise in sales activity, combined with a 10.5% increase in inventory, suggests a more dynamic market environment. Despite these positive trends, the average days on market has extended to around 40 days, indicating that while buyers are active, the process of securing a home may still involve a longer timeline.

For prospective homebuyers, the current mortgage rate presents a compelling incentive to act. With rates at their lowest in over a year, buyers can secure more favorable financing terms and make their home purchase more affordable. Additionally, the increase in inventory offers a broader selection of properties to choose from, further enhancing opportunities in the market.

As the real estate landscape continues to evolve, staying informed about these developments can help buyers make strategic decisions. The combination of lower mortgage rates and increased market activity may set the stage for a rewarding homebuying experience in the months ahead.

2024 Changes to California’s Home Insurance Market

May 28, 2024

2024 Changes to California’s Home Insurance Market

With nearly 40 million residents and a homeownership rate of 55.8%, California boasts one of the largest and most dynamic real estate markets in the United States. However, recent shifts in the home insurance landscape have raised concerns among current and prospective homeowners. Despite these changes, there are still reasons to be optimistic about purchasing a home in California.

Understanding the Current Situation

Over the past year, several major insurers announced limitations on new homeowners’ policies, citing factors including wildfire risk, rising construction costs, and reinsurance premiums. These changes have left many homeowners wondering about the availability and affordability of insurance coverage.

2022
Allstate and State Farm Insurance pause writing new homeowners’ policies in response to increasing costs.

2023
Farmers Insurance and Safeco announce limitations on new policies, while the USAA tightens wildfire and safety standards.

2024
The Hartford, American National, and State Farm announce non-renewals or policy cancellations, reflecting ongoing challenges in the market.

Moving Forward

The recent news of major insurers limiting or pausing the writing of new home insurance policies can understandably create anxiety for homeowners across the state. However, there are safeguards in place to protect certain homeowners from policy non-renewals. For example, the California Department of Insurance ensures that if residents live in a wildfire-prone area, their insurer cannot issue a cancellation or nonrenewal for one year following a governor-declared state of emergency. Homeowners can check their eligibility on the California Department of Insurance website.

While homeowners’ insurance changes raise concerns, it’s important to recognize they also present opportunities for innovation and resilience. Initiatives aim to stabilize the market and ensure access to affordable coverage for all. Additionally, new players may enter the market, offering innovative solutions to address evolving risks and the needs of consumers.

Despite the challenges facing California’s home insurance market, it’s still a great time to buy a home. By staying informed about market developments, exploring alternative coverage options, and working with knowledgeable insurance professionals, homeowners can protect their investment and enjoy the many benefits of homeownership in California.

Finding Coverage

New homeowners in California can still find coverage through respected insurers. In fact, over one hundred insurers are actively writing home insurance policies across the state. Allstate announced this year that they may start writing new homeowners’ policies again if the California Department of Insurance approves rule changes like allowing the use of computer programs to estimate future risks when seeking price increases. By taking proactive steps to evaluate needs, prioritize preferences, and gather quotes, California homeowners can navigate the insurance market with confidence and secure the coverage they need.

When seeking coverage, homeowners should evaluate their needs and priorities. Understanding the amount of coverage required based on location-specific risks and assessing personal belongings are crucial steps in determining the appropriate policy type and coverage level.

Making a list of priorities, like affordability or specialty coverage, can help new homeowners narrow down their choices. Once priorities are established, gathering and comparing quotes from multiple insurers can provide insight into costs and coverage options.

2024 Home Design Trends

February 15, 2024

2024 Home Design Trends

In 2024, home design trends are poised to redefine living spaces through modern innovation and timeless elegance. As the world continues to evolve, so do the preferences of homeowners seeking to create a space that reflects their unique personalities and lifestyles. This year, expect to see a blend of functionality and aesthetic appeal, with an emphasis on color, versatility, and comfort.

Capturing Tranquility in Vibrant Hues

In December, Pantone officially declared “Peach Fuzz” the 2024 Color of the Year. This blend of soft peach tones is expected to make a big impact in home design this year.

“Peach Fuzz” combines the softness of peach with a lively, dynamic zest. Its adaptability makes it a game-changer for home design. This comforting color can be used in both indoor and outdoor spaces to evoke calmness and optimism.

Infusing Peach Fuzz into Home Interiors

Peach works well with a variety of colors, making this year’s hue easy to incorporate into any living space. Peach Fuzz blends well with neutral tones to create a space that feels both expansive and grounded. In bedrooms, the addition of Peach Fuzz to walls, furniture, and décor helps create a relaxing retreat. Combining Peach Fuzz with darker hues adds depth. This warm tone allows dark colors to pop and brings warmth into potentially cold spaces. Pairing Peach Fuzz with luxurious textures like velvet and silk accentuates the color’s softness.

Peach glows into any room, making it the perfect choice for rooms with little natural light. Pairing Peach Fuzz with glass elements like vases and pendant lights enhances this effect, bringing sunshine into living spaces.

Exterior Accents

In outdoor spaces, adorning exterior walls with Peach Fuzz imparts a welcoming allure. This color works well with natural elements like wood and stone. In gardens, Peach Fuzz accents and outdoor furnishings create a warm and inviting retreat.

Statement Furniture

A popular choice for 2024, dramatic statement furniture can transform a room into a piece of art. Peach Fuzz walls and area rugs create the ideal backdrop for bright colored pieces. Layering striking pieces on top of Peach Fuzz produces a breathtaking effect.

70s Styles

When it comes to home interiors, the 70s are making a big comeback in 2024. Create this look by combining dark woods, shiny lacquered surfaces, plush faux fur rugs, and low-lying furniture. This trend is all about adding style and creativity to your living space.

Checkerboards

Checkerboards are another hot design trend this year. However, 2024 isn’t about the traditional black and white checkers. This year’s popular picks include rugs, furniture, throw pillows, and upholstery in vivid jewel tones.

Smart Home Technology

Technology continues to make our lives more comfortable and convenient. This is true when it comes to home design as well. Smart technologies like artificial intelligence and augmented reality allow designers and homeowners to test out layouts, furniture, and hues before implementing any design changes to their space.

Sales of New Construction Homes On the Rise

August 28, 2023

Sales of New Construction Homes On the Rise

According to the U.S. Census Bureau, sales of new homes rose 4.4% in July 2023. This is an incredible 31.5% increase in new home sales since July of last year. If sales continue at this pace, 714,000 new construction homes will sell within the year. This is the fastest seasonally-adjusted annual rate since February 2022.

A big factor in the rise of new home sales across the country is due to a decline of new listings of existing homes. Existing home sales fell 2.2% in July and were down 16.6% year-over-year according to a recent report by the National Association of Realtors. As of July, there were only 1.1 million existing homes for sale across the country. This is less than half the national average for the years between 1999 and March 2020.

Low Inventory Continues to Impact the Housing Market

Many homeowners are reluctant to sell and give up the low mortgage rates secured in previous years. Fortunately, builders have been filling demand by offering creative financing and building new homes to fill the void. Within California, there are approximately 126 home builders actively building new construction homes and permits for future construction increased in July.

New Construction vs. Existing Home Sale Prices

Many homebuyers mistakenly believe that buying new construction costs more than buying an existing home. While that may have been true five years ago, it isn’t the case anymore. New homes are selling at prices competitive with existing homes. In June, the median new construction home sold for just $6,700 more than the median existing home. A recent study by StorageCafe found that in 18 states, it costs less to purchase a new home verses a comparable preexisting home.

Benefits of New Construction Homes

Many people find new construction homes an attractive option. A new home is often located in a more desirable or up-and-coming neighborhood, where existing homes are scarce. This can attract buyers who want to live in specific areas but can’t find existing properties that meet their needs. New homes typically require less immediate maintenance compared to older homes, which can have outdated systems or wear and tear from previous owners. In California, homebuyers can save thousands in their monthly payments due to higher energy efficiency and lower costs to maintain a new home. New homes are equipped with sustainable features like energy-efficient windows, appliances, HVAC systems, and solar panels. This can provide significant long-term savings through lower utility bills. In the long run, monthly expenses are much lower for a newly built, eco-conscious home.

Investing in a new construction home offers several advantages, making it an excellent option for potential buyers. It is an opportunity to enjoy modern comfort, efficiency, and personalization while minimizing the potential drawbacks of older properties.

Rent or Buy? An Honest Look at the Real Estate Market

May 5, 2023

Rent or Buy? An Honest Look at the Real Estate Market

For many people, owning a home is a key part of the American dream. Nearly three-quarters of Americans believe that owning a home is a higher measure of achievement than having a successful career, raising a family, or earning a college degree. According to the National Association of Realtors (NAR), owning a home builds financial security. The net worth of an American homeowner is almost 40 times the net worth of a non-homeowner.

Rental Rates Continue to Rise

According to Fannie Mae, almost 70% of renters would purchase a home if their lease ended now. This makes sense, as rent prices continue to soar in many parts of the country. The average price for a one-bedroom apartment in Southern California is 18% higher than it was last year. Rental price increases will likely continue.

During the pandemic, many landlords had rental rate freezes placed on their properties. These freezes have lifted now, giving landlords the freedom to increase rent prices at will. The University of California Lusk Center for Real Estate predicts continuing rent increases over the next two years.

Is It A Good Time to Buy A Home?

Data suggests the housing market has stabilized. As inflation rates slow, mortgage rates are dropping. Currently, 30-year, fixed-rate mortgage rates average 6.43 percent nationwide. Mortgage rates are even lower for first time homebuyers thanks to mortgage rate discounts instituted by Fannie Mae and Freddie Mac.

Despite the benefits of owning a home, many prospective buyers hesitate due to high interest rates, low home supply, or lack of large downpayment. However, first-time buyers shouldn’t wait. Now is the best time to purchase a home.

Low Down Payments & Greater Chance of Approval

First-time buyers can purchase a home without saving for a 20 percent down payment. In addition to low down payment mortgages, buyers can access down payment assistance through their local housing office.

Getting a mortgage without a big down payment has never been easier. Mortgage lenders recently lowered minimum credit score requirements for FHA, USDA, and VA mortgages. In addition, Congress passed a law to change the way that medical debt is factored into credit scores, raising FICO scores by an average of 22 points.

Low Inventory Will Bring Home Prices Up

Low inventory will likely bring home prices up over the next month and into next season. According to NAR, each state averages less than 20,000 homes for sale each year despite high demand. 57% of homes listed for sale in the U.S. are sold within a month. The supply of existing homes for sale is 2.6 months nationwide. Prospective buyers should act fast to ensure the best price.

Delivering Excellence in Sales

February 3, 2023

Delivering Excellence in Sales

New home buyers rely on their on-site sales associate to guide them through one of the largest decisions of their life. Since each transaction is unique, it is the inexperienced sales associates that fail more often. To deliver an extraordinary experience, it’s important that new home sales associates understand both construction and real estate. This helps ensure the best chance of success. Great new home sales associates know that they are Seller’s agents, while still giving each prospective home buyer an outstanding experience.

Selling isn’t something a new home sales associate does “to” a homebuyer; it’s something they do “for” the homebuyer. Although licensed agents must pass a test to ensure they understand real estate laws and requirements, sales training and coaching is not a state requirement.

Just like an athlete will regularly train to win a race, the highest caliber of new home sales associates constantly hone their skills. Equally important is understanding that the initial sale is only 10% of the job, as new home construction is a specialized side of real estate. Keeping the home buyer engaged through option selections, design center appointments, construction progress, and the last 30 days of their escrow are steps that cannot be overlooked.

What Makes A New Home Sales Associate Successful?

First, they must have a thorough understanding of their builder’s unique buying proposition. What makes that community, design, and location special? Next, they must know the local area intimately. Finally, their role is to communicate this information into the benefit of living in that area, home, and neighborhood, to the prospective home buyer.

Concise and clear communication in a friendly manner is another key to success. Award winning new home sales associates look for innovative ways to market their homes, are responsible for generating leads, retain existing clients, and work with new technology.

The outstanding new home sales associates find ways to stay motivated, investing in training courses, and reading books on sales techniques. They understand that relationships come first. They know a sale cannot exist without a good business relationship.

Cornerstones for success is they must be client-focused, creative, energetic, and passionate about their role. Successful agents follow the “5 times in 21 days” rule of follow-up by phone, email, text message, or mail. Knowing no home “sells itself” they keep in front of their prospective buyers and help them overcome obstacles that may arise. To help understand their competitive market, they visit local open houses, this helps to create excellent rapport with realtors.

Real Estate Sales and Marketing Services

Strong partnerships can provide new home sales associates with the support and tools they need to excel. Our leadership team, with combined 70 years of experience in new home construction and real estate sales, provides each team member with this support through all stages of their professional journey.

Understanding How Mortgage Markets Are Priced

October 27, 2022

Understanding How Mortgage Markets Are Priced

Mortgage rates have steadily increased since the start of 2022. During the last week of September, average 15-year fixed and 30-year fixed mortgage rates climbed to their highest levels in fifteen years.

While recent actions taken by the Federal Reserve to slow down the economy and reduce inflation have had an undeniable impact on current mortgage rates, this isn’t the only factor driving mortgage market pricing. The cost of mortgage-backed securities can have a direct impact on residential mortgage rates. This is because mortgage companies lose money when they issue loans when the market is down. When the price of MBSs drop, mortgage providers typically increase mortgage rates. When the price of MBSs goes up, mortgage rates go down.

Recently, we had the opportunity to speak with Judy Downey-Fortson, an experienced loan originator with Loan Depot Builder Division. She gave us her opinion on what happened with the mortgage markets at the end of September.

Can you tell us about your experience in the real estate market?

“Being a loan originator is a lot like working on a production (assembly) line. As an originator, my work places me in the middle part of ‘the line’. Up the line, is the secondary market group working with the mortgage-backed security market (MBS). Down the line is the servicing and securitization group. It’s not actually a line, but a circle when you have loans that need to be securitized.”

Can you explain what mortgage-backed securities are?

“Mortgage-backed securities (MBS) are like buckets full of loans which investors purchase. The price these investors are willing to pay constantly changes. The difference between each bucket is a ½ point in rate. These are referred to as coupons. The loans that can go into a bucket (coupon) can be as high at 1.125% above the coupon’s value. For example, a 5% bucket (coupon) will contain rates up to 6.125%. So, rates at 6.25% would need to go into a different or higher bucket.”

“As loans are placed or secured in each bucket, there is a good understanding for what investors will pay for that bucket. This understanding is based on recent MBS sales.”

What causes the higher discount point costs reflected in recent rates?

“Mainly its Inflation. As rates increase, a new bucket needs to be re-introduced. This is called the 7% bucket and it hasn’t been seen for over 20 years. So, now the question on everyone’s mind is what, or if, investors will pay for a 7% coupon. There is no recent history of this 7% bucket. This means the value of this new bucket is either big time gambling or speculation.”

“Investors make their returns off a ‘hold time’ for the investment. Prepaying a mortgage or refinancing to a lower rate could mean the investor does not make a return. If investors believe that rates will be coming down in the next 12-18 months, they may pay more for the 6.5% bucket, even though it will have a lower return then the new 7% bucket.”

“In 2019, there was a spike in rates which lasted about 8 months. Rates fell quickly in 2020 and a refi boom happened. The investors who bought the higher rate buckets experienced losses due to rapid refi’s and shorter holding times on those buckets of funds. Therefore, we are not seeing rates being offered at a premium (at zero points or rebate to the customer).”

So, what happened during the last week of September?

“Global economics and England were the spark. Prior to the first week of September, England announced that it would be implementing large tax cuts. Think of putting money in peoples’ pockets for them to spend. That’s a key ingredient to fuel inflation. Worldwide investors feared that it would ignite more inflation and bring about a deeper recession. This is the main reason we had volatile reactions in our own U.S. bond market.”

“On Monday, September 26th, large tax cuts were announced, and the bond market tanked over a full point. This caused mortgage rates to skyrocket and lenders to reprice multiple times and face rates that came with points”.

“By September 28th at 1 p.m., revisions were made to the UK policy and a new bond purchasing program similar to quantitative easing in the U.S was introduced, and the market drastically improved. This unexpected new bond purchase program in the UK was the trigger needed to reverse the powerful trend in MBS markets today.”

With the resignation of England’s new PM after only 45 days, we’re seeing an extremely volatile global market that’s struggling with inflation. Bond yields were well over 4% and dropped back down to around 3.7%, which provided better pricing.”

What’s the best course of action for homebuyers?

“ARM loans or 2/1 buydowns as we anticipate rates to improve in the next 12-18 months. Adjustable-rate mortgages are great for people that plan to pay off their mortgage quickly or expect to sell their home in a short amount of time. However, these loans do have slightly tighter ratios for qualifying.”

If inflation continues to increase and rates keep going up, homebuyers could face higher interest rates and higher monthly mortgage payments. Anyone looking to buy a home should lock in a lower mortgage rate now.”

Thank You, Judy for such an insightful look at the market!

Will Home Prices Go Down?

September 14, 2022

Will Home Prices Go Down?

Analysts, home shoppers, renters, homeowners are all wondering whether home prices will reduce at the same margin that costs to build go up. There are conflicting answers however. Looking closely at housing demand we see the need increasing, not decreasing. With rent, land and the cost of construction going up, it’s hard to say “no” to owning a home today. When asked if rent will increase over the next 7 years, you will have a hard time finding someone that would say “the cost to rent will be lower”.

In seven years, home prices will not be lower from today. It’s unlikely anyone believes they will. The price adjustments occurring now will be small and mainly for homes that had unrealistic prices to start with… let’s face it, it should never cost $800,000 to live in Boise!

Instead of waiting for home prices to go down, prospective buyers are weighing the pros and cons and taking action now. Many sellers are offering attractive financing packages to create a more affordable payment. The rule is: If you can afford the payment on a 7-to-10-year fixed loan, fix your payment now and take advantage of the tax deductions that you won’t get with renting. Statistically, most homeowners move every 13 years according to the National Association of Realtors.

Take a look at the recent data from the Mortgage Bankers Association (MBA), which proves all of the above to be correct.

Tax Breaks for Homebuyers

High demand for rentals continues to drive rent prices up with zero deduction to the tenant, while building wealth for the property owner. It is no secret that one of the cornerstones of building wealth is investing in real estate. Anyone looking for tax breaks should consider buying a home instead of renting.

Homeowners can take advantage of several tax deductions including:

Mortgage Interest Deduction
Homeowners can deduct interest paid on a loan related to building, purchasing, or improving their primary home up to $750,000.
Mortgage Points Deduction
Homebuyers pay “points” to their lender when they take out a mortgage. These points are a form of prepaid interest paid up-front in exchange for a lower interest rate. In most instances, mortgage points are fully deductible the year they’re paid.
State and Local Taxes (SALT) Deduction
The SALT deduction allows property owners to deduct payments made for property taxes and income or sales tax payments up to $10,000.

Housing Affordability

For renters, the choice to buy often comes down to affordability. Average rent for a vacant unit in Orange County jumped to $2,570 per month in 2022, up 18.5% from the spring of 2021. Most Southern California renters are already paying more than they would for a 30-year mortgage. This makes a 7-to-10-year fixed mortgage a feasible option for many renters.