Buying a home is an investment. Equity in a home constitutes a substantial proportion –roughly half – of a typical American family’s net worth. Preparing for and achieving homeownership offers many advantages that foster improved financial acumen. In general, younger households are less disciplined with regard to how much and how well they save. However, the act of buying a home usually requires a down payment and mortgage financing. Prospective homebuyers are therefore more incentivized to better control outstanding debts and harness their ability to accumulate savings.
And it doesn’t end there. Homeownership is a tax-preferred investment. Each year, homeowners are eligible for annual tax benefits, including claiming the mortgage interest and property tax deductions.