Reasons to Delay Buying a Home
Assuming you have the
financial resources and the desire to eventually own your own home,
there are very few good reasons to put off the purchase. You can miss
out on years of appreciation if you do.
The main thing you want
to avoid when buying a home is being put in a position where you will
have to sell it too soon. If you have to sell a home before it has
appreciated enough to cover the costs and commissions of selling, you
could find yourself in a financial bind. This is especially true for
those who buy a home with a down payment of ten percent or less.
Real Estate commissions
traditionally run around six percent of a home’s sales price. The
seller’s closing costs generally come to about one and a half percent.
You can see how this can easily exceed the first year’s appreciation.
If you made a minimal down payment, you could actually have to come up
with cash out of pocket to sell your home.
New to the Area
A very good to reason to
delay buying a home is if you have just moved to an unfamiliar area or
region of the country. It makes sense to rent for a number of months
before deciding on exactly where you want to live. Often when people buy
a home immediately they find that they might have made a better
decision if they had waited awhile.
Uncertain Job
Future
You could be right out of
college or expecting a promotion and a transfer. Or your company has
announced an impending "restructuring." If any of these
apply, it might be best to wait to buy a home. When you have a more
accurate picture of what your next few years will be like, that will be
the time to buy.
Marital
Problems
Real estate agents see a
lot of life unfold before their eyes. One of the saddest occurs when
former clients divorce and are forced to sell a recently purchased
house. It happens all too often when a family in turmoil decides that
buying a new home may help resolve their problems. Perhaps it is
inevitable that such problems occur, but selling a home before it
appreciates can create an additional financial burden in an already
difficult situation.
©2000 by RealEstate ABC, 2004 |
