With the world changing around us and people doing their own thing on their own time, there really is no right answer on the specific age you should buy a home. If you are someone looking to purchase a home, you need to evaluate where you are in life to see if it is the smartest decision. Purchasing a home is a significant milestone, and the goal is for it to be a lucrative investment rather than a negative one.
When to buy a home. The question at hand should really be worded: “When should I buy a home?” You should consider buying one if you can, at the very least, meet the bare minimum steps:
Owning a home is a big responsibility and can be time-consuming, expensive, and sometimes frustrating. You need to be able to plan accordingly as to when to buy a home and choose a home within a comfortable price range.
Buying a home at a younger age can reap many benefits if you have the resources to do so. Without the resources and a low cash flow, waiting to buy a home also has many benefits.
When you buy young, you start building your wealth younger. Buying a home increases your net worth, increasing your overall wealth. When paying your monthly payments, you will build equity in the property, which helps you down the line if you buy more property. Home equity is the portion of your property that you truly “own”. When buying a home, your lender has an interest in your property until your mortgage is paid off. You are the homeowner, but you only “own” a percentage, which is determined based on how much you can afford to pay on your down payment. Price appreciation happens over time, meaning that in the long term your property is likely to gain value. It is not guaranteed, but real estate helps hedge against inflation. You build equity by paying off your loans. The more you pay off, the more percentage of your home that you “own”. Your home equity grows over time if the value of your home is increased. Value can be added with home improvement projects as long as you follow local rules and HOA restrictions. A home is a place to call yours! You can do anything you want with your home or add anything of value to it.
If you decide to wait to buy, you will have much more financial strength and more certainty in the type of home you are looking to buy. Financial strength is the most important aspect when you buy a home. Generally speaking, people make more money as they get older. As you get older, begin making more money, and increase your savings, you have many more options when it comes to home buying. You will have been building credit over the years, helping you qualify for the best possible loan. You will also be able to afford a larger down payment if you had planned and saved.
When the conversation comes up about whether or not you are ready to be a homeowner, there are a bunch of pros and cons you need to weigh out in order to be satisfied and financially responsible. If you are interested in buying a home or you are looking to within the next few years, keep track of the local markets. If the price of buying a house is much cheaper than it was 6 months ago, first find out why it is cheaper, and then compare it to where you are currently living. Is it financially responsible? Will the market increase again next year, raising the value of my property?
So, when to buy a home? You should buy a home at the age you feel the most comfortable when it feels right. Do not buy a home because all of your friends are buying one or because you feel as if you will be too late to buy one. It is smarter to wait, plan, and save if you cannot comfortably afford a home. If you own it, it is your responsibility as well as the extra expenses that come along with it.
If you think now is the right time to buy a home, reach out to one of our realtors today on our agent page.
Article inspired by Justin Prichard, “When is the best age to buy a home” published by the balance.
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