Whether or not you consider your home an asset, there is sometimes a lingering question and curiosity about whether or not it is true. We deal with real estate and assets every day and can easily understand both viewpoints on whether a home is an asset or not. The state you live in could completely change your point of view as well!
We operate mainly in Florida. Here, as long as you own a home and have filed for homestead, there is little, if not nothing, that someone can do to remove you from your house with the exception of not paying taxes or the mortgage. Your house is your house, plain and simple. Now that doesn’t mean that liens can’t be placed on your property and stay until paid off, because they can. It simple means that creditors don’t have the ability to force a sale of your house to satisfy a lien. On the voluntary sale or on death, the lien will have to be paid through the proceeds or through descent/probate. There is a certain level of comfort in knowing that you can live in your house and not be forced to sell if you have liens against it.
That aside, there is the more common dilemma of owning and whether or not that simple fact makes it an asset. I will say that owning a house and having a mortgage did make my credit look better. As strange as it seems, selling our previous house lowered my credit and buying another house made it go up again. Buying a house is part of the American dream and credit companies love it when you do.
If you have owned a home ever, then you know what goes into such ownership. Yes, you are building equity by paying the mortgage off, but at the same time, you still have to preserve that equity by keeping the property in good shape. You need to fix things in order for it to keep value!
We see many houses where there should have been more equity, but due to deferred maintenance and poor keeping, the value was severely lowered. Our most recent purchase was one such house. The potential was huge, but the amount of deferred maintenance that we had to play catch up with was also huge, so we ended up buying it at a 64% discount. It happens and that is the niche that we love to work in.
It kind of depends on you on whether or not your house is an asset or a liability really. For me, spending endless days maintaining a property that I own isn’t fun, so I would much rather pay someone to do that. As long as I can afford to do that, the house is an asset. That aside, as long as there is usable equity in the same property, then it is also as asset in my eyes.
I used to think that big, expensive houses were such a waste and I still do to a certain extent. However, my tune has actually changed on that subject and I can see the value of owning a expensive house providing there is equity that can be used in the form of a Home Equity Line of Credit (HELOC). Were it not for these types of loans, I probably wouldn’t consider owning a personal residence ever again. Having access to that money quickly is what helps a lot of people invest and find good deals that can be purchased quickly.
That is something that you can do too! That power is what makes real estate so persuasive. You don’t have to own a business and you can still leverage real estate for personal goals. The power is there to use real estate as an asset, but you will have to do some work in keeping the value in the property or pay someone else to do it for you. Our advice would be to take advantage of it!
We can be reached at (850) 710-0710 or by email at firstname.lastname@example.org. Sonny Side Property Solutions is here to help everyone with their real estate needs, especially homeowners that need help now! We are here to serve the community and provide real estate solutions for any situation and we have a national network of investors and brokers that we work with and can call on at any time.
We can be reached by phone at (850) 710-0710 or by email at email@example.com.