Buying a house is a huge milestone in the average person’s life. Unless you were born into money or made a killing very early on, it takes years of hard work before you are in the financial situation to even consider it. And while some don’t mind delaying this milestone and paying rent on an apartment in the meantime, others feel like they can no longer wait. They have a child on the way, or they resent the money wasted paying for property that is never going to be theirs. Some simply do not feel like they've been successful until they have bought their first property.
But the agitation to buy a house can lead to poor decisions. Not only are some buyers not in a good financial position, but there are many who, if they could look at it objectively, would see that a house is not an investment they want to make right now.
Here are 3 criteria that you must definitely meet if you are ready to buy your first house.
1. Your finances are in order
Although it should be obvious, this is by no means the case. There are many individuals and couples who choose to buy a house while still under pressure from credit card debts, student loans, and the like. While being debt free is definitely not a prerequisite to buying property, it is necessary that you are on top of your financial situation. You're not one step away from falling behind on repayments. You have a good credit score that is not at risk. You're not relying on your yearly bonus to get you out of trouble. If there’s an imminent possibility you might lose control of your financial situation, even if it’s unlikely, you should hold off on buying a house.
2. Your lifestyle won’t change
Too often we’re swayed by where we feel we should be, rather than by what makes us happy. If you've got the quality of life you always imagined for yourself, don’t throw that away. Maybe you're seeing friends and colleagues buying houses, and it seems like you're falling behind. But if you're going to have to sacrifice your lifestyle, it may not be worth it. For many, buying a house means they won’t get to travel for the foreseeable future or they're going to have to stop eating out or splashing out on entertainment. A house should benefit your lifestyle, not compromise it.
3. You're happy where you are
Finally, a crucial factor in choosing to buy a house is that you're happy living where you are. Before you make the investment, you might not see all the ways a house ties you down. Yes, you could always sell or rent it out if you want to move away, but finding a buyer or tenant is not easy, and can delay your plans indefinitely. Furthermore, having kept up with maintenance or done any extra work on your house, you'll be unhappy letting it go without making back what you put into it. But the truth is that its value may well have appreciated at too slow a pace to match your investment. Putting the necessary work into a house is worth it if you're there for the long run, but not if you move every couple of years.
Ultimately, the decision to buy a house is one that should not be made lightly. If there are any doubts in your mind, you'd better explore them. Otherwise, your new property might bring you nothing but stress.