99% of the population loves spending money if they have it. You might say you don’t, but just remember the adrenaline rush you had when you handed over the cash and carried your last purchase out to the car. It’s even better with your first home because it will be the most expensive thing you have ever bought so far, plus it’s a big leap from your next highest purchase which was probably a car. Spending so much money all at once makes you go a little crazy sometimes.
Because you’ve not bought a house before you might be in for a tough time, but this isn’t something you want. The last thing in the world you need is for something to go wrong because it will bring you untold stress. It’s even worse if you end up living in a house you don’t want because you made a mistake when you bought it. This means getting everything right the first time is absolutely essential, so we’re going to look at questions you must as yourself before you hand over any money.
How long is it for?
There are lots of reasons why you might not want to stay in a certain house for very long. When you are planning to have a baby it’s not to wise to buy a studio apartment in the city. You might be waiting for a promotion at work that will take you all the way over to the other side of the country. In those kinds of circumstances it’s not a good idea to buy anything and you would be better waiting for a few years to see what happens. You don’t want to be stuck with something that doesn’t fit your needs.
Can you afford it?
Do you remember what happens when your hours get cut at work, or when you know you like to spend more than your fair share of money supporting designer fashion labels? When you get a mortgage it shouldn’t really be more than 25% of your total income otherwise you might have a lovely home, but you will be stuck inside 24/7 because you don’t have any money to go out. Don’t even convince yourself you can afford more even if you fall in love with a certain place, or be prepared to have a stressful life once you sign on the dotted line.
Can you move straight in?
Your home should have passed an inspection before you even start to get a little bit excited. If anything is seriously wrong with it you have to walk away. It might be beautiful in the outside, but deep inside the heart of the house it could be rotten to the core. It’s different when there are just a few bits of work that needs to be done, but you should still check how much this will cost. If you don’t have the cash to pay for it on top of the deposit you might be left with a sub-standard house.
Are you sure you’re ready?
Once you own the home the amount of responsibilities you have multiplies. When things go wrong, and they will, it’s down to you to get them repaired. A house is like a baby and all your money gets pumped into it for the first few years. You might feel like you are too young and you want to enjoy life a little more before you are saddled with this huge debt. Think about all those summer holidays you will miss out on until you’re making a lot more money.
Who is paying for it?
When you buy your first home it’s most likely going to be with a partner because they cost a lot of money and most people can’t afford one on their own. Think about how much people split up these days and even marriage is not sacred. That isn’t meant to put you off buying somewhere to live with someone you love, but make sure it’s not a shotgun decision the both of you will regret. Owning a home with someone you are not with is very hard work and even more so depending on how you split up with each other.
Originally posted by Nelson White on Tuesday, 29th January 2013
Great info on everything real estate.