Once you cross the threshold over into adulthood, you might feel the pressure to buy a home. However, you should wait to buy a home until you are ready to take on the responsibilities of home ownership. If you are unsure if now is the time to buy, here are some questions you can ask yourself to determine the answer.
Can You Afford the Down Payment?
Before you can seriously consider buying a home, you need to assess whether or not paying a down payment is within your budget. To buy a home, you will need about three percent of the home's purchase price. If you do not have the money readily available, you will have to put off your home search until you save for it.
Of course, you can turn to your parents or other family and friends to help come up with the down payment. However, you will have to factor in the cost of repaying them with also paying your mortgage and other bills.
Are You Ready to Live in a Home for the Next Five Years?
Unless you are ready to commit to buying and living in a home for the next five years, it might not be the time to do it. Buying a home takes time and effort. If you do not live there at least five years, it could potentially mean all your efforts were wasted.
There is no guarantee that your home's value will increase in the time you stay in the home. If you sell it shortly after moving in, the amount you get back might not be enough to even cover what you spent on the home. However, you can turn the home into an investment opportunity by renting it out to others.
Can You Afford the Hidden Costs?
One of the biggest surprises that new homeowners face is learning that there are hidden costs that come with owning a home. You more than likely are prepared to pay a mortgage, but are you prepared to tackle the hidden fees?
For instance, your home will require maintenance, such as annual inspections of the roof, plumbing, and HVAC systems. In addition to these fees, if you live in a homeowners association, there can be special assessments added to your fees to help cover special projects the HOA has planned.
If you are ready to take on homeownership, work with a real estate agent who can help you find the home of your dreams.