If you’ve recently graduated from college, or have spent years saving and have lots of money in your account…you may have already started about considering purchasing your first house. But…is it really right for you? It’s not usually advised that you buy a house before you even hit 30. See: Getting a Mortgage in Your 20s.
There are many reasons for that. Below are some reasons that you should not buy a house yet. You may think you’re ready…but the chances are, that if you are still in your 20s, you shouldn’t buy a house yet. Below are some things you should think about in order to decide whether purchasing is really a good idea or not right now.
Realize that once you buy, it is permanent. When you’re renting, you’re only committed to something for one year (at the most). When you buy, you’re committing for at least 3-5 years. This is the amount of time that a homeowner must stay in a home in order to not lose money that they spent. It costs more than just the list price to buy a house. You’ve got closing costs, taxes, and all sorts of other hidden expenses that amount to a lot. If you want to avoid a huge loss, you’ve got to stay in the house for quite some time. Read: Mid 20’s; Should I Buy a House?
Understand that when you buy a house, you’re not going to have nearly as much free time. Maintaining a house is hard work, and things come up often that need to be fixed, or handled. Remember, you can’t call your landlord anymore to come over and fix it for free at their earliest convenience. You’re your own landlord. There are routine maintenance things that you simply can’t forget to do. When you’re in a rental, you don’t care if you forget to change the heat filter, because if it ever breaks, it won’t be your fault, and you’ll likely be out of there before it ever does break. Forgetting to change a heat filter over time, can result in the whole system being destroyed, for example.
One benefit to buying, is that you’re free to decorate however you want to. Want to tear out a wall partition? Go for it! Want to paint the exterior of the house purple? Your call! That is a huge benefit. When you rent, you can’t really make the house show your personality, because you aren’t allowed to make any big changes. This is one reason people prefer to buy, is that they can make the house custom to whatever they want. They can change the floor, get a large pet that they aren’t allowed to have when they rent. See: Why You Should Consider Real Estate Investing in Your 20s.
Another benefit to buying is that it’s very likely the house will only increase in value after you buy it (depending on where the house is, and the condition). This means, it’s possible you could make a profit when you sell. Also remember, it depends on the market. You could end up losing money; its always a gamble, so don’t buy a house with the intent to make a profit…unless you are a real estate investor.