I'm a Realtor by trade, so this might seem counter-intuitive, but I have to get something off my chest: Not everyone should buy a house.
Credit Image: Images_of_Money on Flickr
Whew. I feel a little better. That was clogging up my Chi.
I know the current general consensus is you're not an American and you don't have dreams if you're not hoping to own a home with a white picket fence, but I really have to beg to differ with the wisdom of this. There are a lot things that are NOT reasons to buy a house:
1. You want to prove to your parents you're a grown-up.
Oh, Honey. If you're still trying to "prove" you're a grown-up, you're not yet. And your parents definitely aren't going to take you more seriously when you have to come to them in month two asking for a loan to make your mortgage payment.
2. You've always had a dream of painting the walls in your home purple and green plaid.
Landlords are generally happy to let you express your individuality as long as you're willing to give them a decent deposit and paint it back before you move out. Paint is not a reason to buy.
3. Everyone you know is buying a house, and you're feeling left out.
I'm gonna go ahead and be your mom right now, "If all of your friends jumped off a cliff, dear, what would you do?" Because in certain situations, that's what you'd be doing: jumping off a financial cliff.
4. You heard on the news the local housing market is "going crazy" and you feel like that means it must be a "good time" to buy.
Ah yes, that's the market you want to buy in: little inventory, lots of competition, prices on the rise. That's definitely where the smart money is. Not. Is not, is what I meant.
5. You just got a job in a brand new city you don't know, and you think buying a house immediately will make you feel more at home.
I've seen it time and time again. People are transferred in with a new job and without knowing the area, they drive around for a couple of days and buy a house, only to realize three months later that they absolutely cannot stand the neighborhood/commute time/variety of pollen the trees produce. It just doesn't make a lot of sense to buy without having had time to really soak the community in. Rent for a year. THEN buy.
6. Your grandpa told you when you were little renting is just "throwing away your money," and you always had a deep respect for that man.
Your grandpa sounds like a sweetie, but the poor man was working with old information. Do you remember the housing bubble? How about how it popped? In Arizona we saw a 50% decrease in values from 2005-2009 in many areas. Does that sound like a good investment to you?
7. Your wife's best friend just bought a house so your wife has serious housing-envy and is refusing to have sex with you until you buy her a house.
Oh, your wife is kind of a bitch. You should consider counseling or possible a trial separation until she gets her head out of her hindquarters. You are the ones who will have to ultimately live with your financial decisions long-term. Ignore external distractions.
8. You're pregnant and pretty sure it will automatically make you a bad parent if you are just renting a house. Kids need stability and a mortgage payment to really thrive.
Not even one of my children was born knowing how to spell "mortgage" (which was a significant disappointment to me). Parenting and stability are not even a little bit about owning a home.
9. The tax benefits you will get from owning the house will absolutely, without fail, make the purchase financially worth your while.
See number 6. Yes, the tax benefits are great, this is no longer a legitimate blanket statement (if it even ever was). You need to look at the whole picture. It might be worth it, but it also could very well not be.
10. Your sister owns a house, and you've always felt moderately competitive toward her. If she can do it, you can do it bigger and better.
You're prettier and have bigger boobs than your sister. You need to just be content with this.
I'm not saying you're never going to be ready to buy a house. I'm not even saying it's not the time for you now. My point is only that I've seen people buy for all of these reasons I have listed and I've seen it not work out well. The big picture is the most important thing to consider.
Elizabeth Newlin - Realtor®, mom to three boys, humorist, overcommitted. Head over to www.RealEstateTangent.com to hear all about it.
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