Deborah knocked one past the Goalie here. This is a great point, not everyone should be or needs to be a home owner. It is a tough reality that most in the real estate profession seem to be hiding from.
Maybe you shouldn't buy a home. Yep, I said it. Even though I'm in the business to "sell" homes, some people shouldn't really buy a home now, or possibly ever. Renting may be a better option for some. Believe me, I'd much rather have a happy client than someone who regrets making the decision to buy.
So, maybe you think you want to buy a home. But make sure it's the right thing to do for you. Here are SIX things to think about:
1. Buying for the tax credit. Isn't it great that you can get a tax credit just for buying a home? Sure it's a great motivator (I wish it was there when I bought, as do thousands and thousands of other home owners), but it shouldn't be the sole reason to buy a home. There are so many other reasons. Ask yourself whether you still want to buy a home if you miss out on the credit. If you don't, you probably don't want to buy one anyway.
2. Can only afford a fixer but cant fix it. With many bank owned or distressed sales there is inventory available, often with major repairs needed. Just because you can afford the sales price doesn't mean you can afford the repairs. Before jumping into a "fixer," make sure you have the money, or resources, available to fix it. Otherwise, don't buy it.
3. It's "time." Reached a certain age? Got married? Had a baby? There are many life milestones where we are "supposed" to buy a home. Before jumping into home ownership, make sure that it's because you want to buy a home and not because of external or societal pressures.
4. You make enough to pay monthly bills, but that's it. If you live paycheck to paycheck you probably want more financial security before buying a home. Home ownership involves much more than making your monthly mortgage payment. There are always unforeseen expenses, plus if your income is reduced or lost, and you don't have extra funds set aside, you could also become a foreclosure statistic.
5. Not motivated to maintain or pay someone to maintain your home. When you rent it's so easy to call your landlord to deal with a home issue. Once you buy it can be shocking to realize you have no one to look to except yourself. YOU will be solely responsible for your home. Even if you live in a condo complex, you will have things that you have to take care of. And you have to do it or pay someone to do it. If this isn't appealing it probably is better to rent.
6. See it only as an investment. Before the market changed many buyers bought so they could make a bunch of money as prices went higher. Didn't work out so well for some. Before then people bought homes with the intention of living in them as their home for a long time and not necessarily as an investment. Times have changed and people buy and sell every few years, so of course, home ownership and what it means changed too. Unless you're really an investor, however, buying only to increase your net worth may not serve you well.
Deborah Engel, Prudential California Realty, is a recognized San Diego and Carmel Valley Realtor for top client satisfaction. If you'd like to learn more about Deborah, visit her website, www.PropertyByDeb.com, email her, Deb@PropertyByDeb.com, or call her at 858-829-1989.
Unless otherwise noted, all content of this blog is the property of Lane Bailey, ©2012 Lane Bailey.
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Lane - thanks for reblogging. I missed it the first go around. Deborah this is a great list. Another point at least for Montrose Colorado is you can rent twice the home you can afford to buy. Our rental market is soft and the rent seldom covers the payment of a low down loan (most buyers - that I run into.... unless they are all cash). This is even more true on the high end. e.g. Rent a 400-500K home for $1,500 to $2,000/mo.
Lane, So true and everyone buyer should make sure that they are buying for the right reason.
Chris, Once upon a time, waaaay back there, lived in Montrose. Beautiful country.
Thanks for the comments - Deborah deserves the credit..