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Nancy Reynolds - Rainmaker Real Estate - The Most Referred Name in Silicon Valley Real Estate

What is the best age to buy real estate? Well you are asking someone that believes in the power of real estate and always has. I bought my first home at the age of 19. I bought it because my dad told me that I made too much money to be wasting it making someone else’s financial portfolio stronger instead of my own. He said if I could pay rent for a nice apartment then I could afford a mortgage. 

This was 1988. At the time, we weren’t all thinking of the hundreds of thousands of dollars our real estate values would go up. We were focused on a few other reasons for owning your own home instead of renting someone else’s: 1. Leverage – when you are in good standing with a mortgage everyone wants to lend you money. You don’t have to borrow it but knowing that it is available to you helps build confidence in your financial future. 2. Tax deduction: You can write off the interest on your mortgage payment instead of paying that money in taxes. 3. Return on investment: You can improve your property and benefit from the upgraded environment of the home you live in as well as increase the value at the same time. When you sell the home with these improvements, you stand to sell for more money so you realize the gain instead of your landlord. 4. Control: Nobody but you can raise your monthly payment or limit you on how you wish to decorate and upgrade your home. Sure, when you rent, your landlord has to pay to fix appliances and infrastructure that breaks down but they control everything in the process (who will enter your home to do the work, when they will complete the work and what materials/appliances will be used). Additionally, if you are renting you have no voice or vote in management directives brought on either by the HOA board or the local government. 

Fast forward to today, everyone thinks about how much their property values will go up because we live in a thriving area where there is always a fresh group of well-qualified buyers landing on our shores and THEY know the value of owning a piece of dirt in America. So now we can add the 5th most valuable reason to own your home instead of borrowing someone else’s. 5. Equity: In a slow market your house will rise 1-3% per year on average. In today’s fast-paced, highly competitive market we are seeing an average of 13% increase year over year. In my case,, the home was a townhouse that we purchased for $109,000 with a $200/month HOA. With almost no down payment, my mortgage and HOA dues were under $1100/month. I would’ve paid it off 3 years ago and would, today, have an asset worth approximately $550,000. Also, I could’ve rented it out for well over $1100/month over the last 20 years and I haven’t even calculated what kind money that would’ve put into my account.

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