There are a lot of perks to renting. Most maintenance is taken care of, you can leave when you want (most of the time), and you’re not at risk of losing money in a fluctuating market. However, there comes a time in many people’s lives where buying a home ultimately makes more sense. Here are three signs that you’re ready to buy a home.
1. You Have Reliable Income
When you’re young, coming across a consistent income stream can be difficult. You may have bursts of good fortune and then have months of financial instability (this is especially true if you’re a freelancer). However, if you have reached a point in your career where your income is stable (even if it’s modest), you can start predicting your financial future. When you know that you will receive a paycheck ten years from now and what that paycheck may look like, paying more and more in rent hikes begins to make less sense. This may be a time when homeownership begins to make more sense.
2. You’re Ready to Put Down Roots
Climbing the corporate ladder isn’t always straight up. Sometimes, climbing this ladder can take you from city to city in search of favorable opportunities. Once you have determined what city or town you want to live in for the next 10-30 years, buying a home in that place makes sense. If you’re still not sure if you’re going to remain in a select city, buying is a home is fairly risky. While you could potentially rent out a home you own elsewhere while you pursue a new opportunity, homeownership will tether you to a specific geographic location like few other obligations can. Make sure you dig the spot before you spring for homeownership. Selling a home, even more than buying one, is very expensive and challenging.
3. You Have a Decent Down Payment (or Can Acquire It)
If you don’t have a generous down payment ready to drop on a home, you will be paying for it and then some down the road. Not having at least a 20% down payment means you will also need to pay for mortgage insurance — insurance that protects mortgage companies from a loss if you can’t make the payments. These payments can add thousands of dollars a year to the cost of owning a home. In addition to mortgage insurance, you will likely be paying inflated interest rates in the place of a decent downpayment. So, before you even go to apply for a mortgage, it is a good idea to have a 20% of the price stowed away or at least qualify for a mortgage assistance program that can help you meet that 20% threshold.
Instead of buying a house that somewhat needs your needs, have you ever considered a custom-built home that is guaranteed to? Working with the property experts from Perry Hood Properties, you can build your Oklahoma dream home in less time than you think.