Buying your first house is an exciting, and scary, time in your life. The idea of home ownership is something that appeals to many people for a variety of reasons. There are plenty of financial benefits to be enjoyed, in addition to the autonomy of owning your own property and not having to answer to a landlord.
Of course, buying a house is a major decision that should not be taken lightly. It will likely be the most expensive purchase you make in your entire life, and taking on a mortgage is something you need to think about before getting too far into the process. Just make sure you don’t give into the myth that buying a house is the right thing to do in all circumstances. In some cases it’s not, so you want to make sure you avoid making a mistake that could cost you dearly.
Whether you plan on buying a house for security and stability where you can eventually sign over the rights to the property to your spouse or children using a quick claim deed form, or decide to sell it when you please, there are things you should consider before making that kind of investment.
Are You Settled in a Location?
One of the first things to think about when considering buying your first house is whether or not you expect to be settled in the same location for at least the next few years. Life can always take unexpected turns, but do your best to think ahead and decide if you plan to stay put for the time being.
If you think you might be moving in the near future, continuing to rent a place to live likely makes more sense than purchasing a home which you might have to turn back around and try to sell.
What Does Your Budget Get You?
It can be an eye opening experience for many first time buyers to realize that their budget might not be enough to purchase the kind of home they had in mind. To see how far your dollar will go, first get a good estimate of what your home buying budget would be – there are many online calculators that can help you figure this out.
With that number in hand, browse a few real estate websites to see what kind of homes are listed in that price range. While none of this exercise is an exact science, it should give you a pretty good idea of what you will be able to afford. If the homes in your price range look attractive to you, then buying your first home might be the right choice.
What is Your Work Situation?
Qualifying for a home loan is a process that requires you to go through some extensive financial analysis by the bank or lender that you are hoping to work with. That means they will want to see plenty of documentation regarding your finances, as well as information about your current employment and work history in order to determine if they believe you’re ready to buy a home.
If you have only just started working at your job, it might be difficult to qualify for a loan. However, if you have been in your job for a year or two and have a steady earning history, the bank might be more favorable with their review. Knowing that you are considering the purchase of a home in the near future, keep your employment picture in mind when making career decisions.
There is no ‘perfect’ time to purchase your first house. This is especially the case when you begin to compare against what others are doing as you need to make sure it’s right for you and your situation.
What other things do you think need to be considered when looking to buy your first house? When did you purchase your first home? Where do you stand on the owning vs. renting debate?
Photo courtesy of: My Guys Moving
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