3 Good Reasons Why You Should Wait To Buy A Home
Most would agree, why would you rent if you could buy?! With interest rates as low as they are it should be a no brainer right? Let’s just find a place and lock it in for the next 30 years… seems like a long time? That’s because it is. The following are reasons why you should NOT buy unless you know you are ready. You may not be thinking purchasing is all it’s cracked up to be after you read the top 3 reasons to rent.
1. Location, Location, Location – It may seem like you have found a good area that is safe and close to everything you enjoy on the weekends but what about your career? Are you confident you are set up in a place that you will continue working for many years? Since you like the area so much have you looked into the property tax rates and other local fees like insurance rates to own a home in the area? What about your dream job or school you have considered for the past few years? I will tell you that if you rent none of the previous items would be an issue, things like tax rates or your ability to be mobile would not be an issue. I would suggest to really consider your future plans before you look to buy because getting out of a 30 year mortgage or selling a place you just bought is a huge hassle.
2. Affordability – If you are renting for $1200 a month you can afford a $1200 a month mortgage right? Not exactly, there are a lot of costs that renting a place includes that you may not be aware of. Just a small list of why being a homeowner may not be what you want right now; HOA fees, property taxes, mortgage fees, home insurance, yard maintenance and home maintenance. These items may not seem terrible but when you add all of them up you could add another 50% to the mortgage costs. Even if you feel like you could budget for it keep in mind some of these items are not announced and the leaky roof that could cost thousands of dollars as a home owner would cost you ZERO as a renter and the $1200 monthly payment stays that way.
4. Sensibility – If you decide the above reasons do not directly impact you or your decision to rent or buy, the last reason is sensibility. Sensibility is more than just the numbers adding up it comes down to truly being able to make the purchase and be comfortable with your quality of life and standard of living. Keep in mind you want at least 20% saved up for a down payment and ideally all the rest of your debt paid off, if you are in this boat then buying a home maybe your next step. Sensibility also reflects the peace you have each month and the feeling that you aren’t stretched to pay your bills, save for retirement and to give when others are in need.
Not to make buying seem like a bad thing but if you are not ready than the purchase will end up being a curse more than a blessing. Buying a home can also be one of the greatest investments you make in your life but if you make it at the wrong time it can be the biggest disaster. I highly recommend purchasing a home but keep in mind it is still OKAY to rent for a period of transition, saving or relocating. In the meantime do your research and continue to use tools like www.MoversAtlas.com when you look to rent or buy a new home.