The reality is that home ownership isn’t for everyone. Ok, not exactly! And even if it’s right for you, it might not be right for you right now. Whether you’re tired of renting, looking to settle down or just want to put your money toward something bigger, experts at wisebread.com say there are a few factors that should serve as a warning against taking the leap. You shouldn’t buy a home if …
You aren’t planning to stay
Whether your job situation is a bit uncertain, you’re in a relationship you’re not sure will last, or you’re longing to make a move to another city in the not-too-distant future, renting is your best bet. That’s because home values tend to fluctuate a bit throughout the year and from year to year. If you are forced to move out in the near future, you may suffer a loss on the sale of your home. That’s why most experts recommend that unless you can stay put for at least five years, you’re better off renting. It’ll take at least that long to make up the costs associated with a home purchase.
You don’t have a down payment
It’s still possible to buy a home without a down payment, but that doesn’t mean it’s a good idea. The simplest reason is that foregoing a down payment costs you a lot more over the life of the loan. The more money you borrow to buy your house, the more interest you pay. Having a down payment protects you from going underwater on your loan, or owing more than the house is worth. This can happen when you buy without a down payment and then home values drop. It’s a real bummer if you want to sell.
You aren’t a saver
Speaking of a down payment, if you find saving for one to be a challenge, that in itself may be a sign that you aren’t ready to own your own home. When you’re a renter, all you have to worry about is covering your rent. Once you’ve done that, the rest is up to your landlord.
When you own your home, the responsibility is all yours. So, whether your problem is a leaky roof or a broken water pipe, you will have to pay to fix it (and in many cases, it’ll cost you dearly). Without a strong habit of saving, you’ll lack the cash to take care of all the expensive repairs you will face as a homeowner. If you’re already living paycheck to paycheck, the ongoing financial responsibility of owning a home is likely to land you in debt.
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