1. Your credit’s less than stellar.
If you don’t have a particularly great credit score, you can still buy a house, it just probably isn’t the smartest financial plan. Lenders and banks will still likely allow you to borrow from them, but what you’ll pay in fees and interest rates will be exorbitantly high.
Furthermore, it will also equate to a higher mortgage payment. If this is the case for you, you may want to sit down and seriously consider whether or not it’s the right move for you.
2. You tend to move around.
When you rent a place, it can be easy to develop the habit of constantly changing location. Maybe you change places because you like to try new parts of your town, or maybe your job location changes, or maybe you have kids who need better schools. There are many reasons people choose to switch locations on a regular basis. However, once you have a home, that option is no longer feasible.
When you decide to purchase a home, it’s usually best to plan on staying there for at least five years. Moving is not only more of a hassle, but trying to sell your home can sometimes be an extremely slow-moving process. That being said, if you’re someone who loves to keep their options open, you might want to just keep renting.
3. The market’s declining.
Many people’s incentive to buy a home is to build equity, and while that’s a valid and good financial move, it’s important to consider the market before doing so. The housing market, like many things, goes through periods when it’s on the rise and periods when it declines. Unfortunately, if the market keeps falling, so will your equity within your home. So if building equity is one of your driving factors for buying a house, be wary and alert to what the markets are doing, so you don’t end up in a disappointing situation.
4. You travel a lot.
Depending on your profession, you may find it within your job description to travel on a regular basis. If that’s the case for you, you might find that you’re rarely at home. Between travel schedules, your times at home may be few and far between – and that’s before airline delays and cancellations. This, of course, raises the question, if you’re never home, why buy a house? When the road is your home, it’s rarely worth the investment of your money and paying for the upkeep of an expensive property.
5. You’ll be responsible for all repairs.
The beauty of apartment living is that you’re not responsible for certain maintenance and repairs. Everything in your home has a lifespan, whether it’s your washer, air conditioner, stove, pipes or even your roof. If you own a home, that’s all money out of your pocket, because you’re the sole person responsible for fixing it. In an apartment, however, all of those fixes are out of your hands and your wallet.
Maintaining your home is another major expense you’ll want to consider before purchasing your first home. Decide whether or not you’re ready to handle life’s unexpected situations.
6. You don’t want to take on new debt.
As you must know, a home is a major investment, and obviously one that won’t come cheap. If you already have debt, adding a mortgage to your monthly payments is only going to build on top of that. But if you don’t have debt, why give up the freedom of being debt-free?
Many Canadians feel the weight of their mortgage payment each month; thankfully, it’s not a necessity. Take the time to make a thoughtful decision about whether or not it is an expense you’re ready for, or want to take on. If other areas of your life, such as travel or education, are more important to you, then you may be better off spending on those instead.
7. You can invest in other things.
Contrary to popular belief, a home isn’t always the best investment you can make. After all, selling your home can be a slow and difficult process that can often cost you money, which means you might not get out of it what you put in.
Moreover, sometimes, even if your home’s value rises, it still might not be enough to offset the costs you’ve invested into your home throughout the years.
If investing is your only goal, purchasing a home isn’t necessarily the answer. Instead, look into other, possibly more lucrative options available to you. The stock market may not be the surest thing either, but it does offer the option of tax deductions when it comes to losses.
Purchasing your first home can be a wonderful and rewarding experience. For some, it is the obvious next step, as a home might be just what they need to meet their new life situation. That being said, you don’t have to buy a home, and for some, it’s not the right path. Before you decide to buy a house, carefully consider your motivation to become a homeowner and whether or not it’s financially right for you.