For most people, taking the leap into homeownership isn’t exactly a walk in the park. Rather, it means years of hard work saving up every penny for a down payment. Then, once new owners get ahold of the keys to their hard-earned property, it’s easy to get swept up into remodeling and redecorating and blow money that could be much-needed further down the road.
It’s important to remember that the down payment, closing costs and monthly mortgage payments are just some of the various expenses that homeowners incur. There are also utility bills, insurance costs, property taxes, homeowners’ association (HOA) dues, routine maintenance fees and emergency repairs — just to name a few of the extra expenses. If you don’t want to jeopardize your achievement in purchasing a home, check out the following money-saving steps for new homeowners.
Lower Your Utility Bills
Energy efficiency simply means using less energy to perform the same tasks. One way to achieve this is opting for energy-efficient appliances and electronics for your home. While you could hire an expert for a more thorough home energy assessment, a DIY home energy audit will help you uncover problem areas and drive down your costs. Check for air leaks, have your HVAC system cleaned and inspected periodically, and consider replacing inefficient bulbs with energy-saving incandescent bulbs, compact fluorescent lamps (CFLs), or light-emitting diodes (LEDs).
Shop Thriftily
Along with springing for energy-efficient appliances, you’ll want to be economical when it comes to furniture purchases. Resist the temptation to fill every empty space with furnishings and remember there’s no need to upgrade old items right away. Get more life from your existing furniture. Old wood can often benefit from a little sandpaper and a fresh coat of paint and varnish. While you are building your savings account back up, new upholstery or even a slipcover can breathe new life into your couch at a fraction of the cost of new furniture.
When you do have to go shopping, your best bet is to buy second-hand. Visit your local consignment and thrift stores and seek out estate sales. Ask around your inner circle to find out if someone is planning on getting rid of used furniture, and keep your eyes peeled for end-of-season and holiday sales.
Make The Most Of Your Tax Return
Homeownership significantly changes your tax situation and the deductions you are eligible to claim. For homeowners, $750,000 is the amount of mortgage debt for which interest can be deducted from income taxes. Also, you will pay no capital gains tax on the first $250,000 (or $500,000 for married couples) you make when you sell your home — provided that the home has been occupied as your primary residence for two of the past five years.
If your home is outfitted with solar energy systems, geothermal heat pumps, small wind turbines or fuel cells, you can benefit from federal tax credits for residential renewable energy products. Your state may also offer additional incentives. A good idea is to consult accountants and financial advisors for at least the first year of homeownership to ensure you are getting the most benefit from your tax return. At Fairway Independent Mortgage Corporation Fort Lauderdale, we're happy to help. For additional questions and support during the homebuying process, contact one of our loan officers today!
