It’s time. You are tired of renting and paying someone else’s mortgage for them. Time to pay your own. There’s a lot to consider when deciding not only to buy but what to buy. Here are the three most important.
First, what is it that you are looking to buy? Do you want a townhouse? A condo? A dingle family home?
What about style of home? What about must haves? Is it really that important to have 5 bedrooms and 3 baths or would 2 or 3 bedrooms and 2 baths work for you?
Where do you want to buy? City? Suburb? Rural area?
What about things like local schools? All of these things are really important to figure out before you start looking.
Make a list of your must haves. Look at your family situation to help narrow down things like size and location of your home. If you are just starting out, smaller may be a good choice. If you have children or extended family living with you, larger may be better.
Next, consider whether you will be staying in the home short or long term. If you are not planning to move, consider things such as will you be adding to/subtracting from your family.
If you think you may not stay long term, consider buying below your budget so that when you are ready to sell in the next few years, you will be in a good place to not get negatively hit financially. Even if you plan on renting it out, do some research the rental market of the area before buying.
Lastly, can you afford to buy a home? This is a big consideration. How is your credit? Did you realize that your mortgage payment includes things like real estate taxes and home owners insurance and that ISN’T going to be in the amount your mortgage company or bank will be giving you for a monthly payment.
Do you have savings beyond your down payment? Keep in mind that when you own a home there is no landlord to swoop in any fix things like broken pipes.
Also remember that just because your lender says you can afford a $1,500 a month mortgage payment, it doesn’t mean you should take one out. Keep room in your budget for saving or unforeseen expenses.