Should you buy a ‘forever’ home or a ‘for now’ home?
Buying a home can be a stressful process. Spending hundreds of thousands of dollars is not a small decision. When looking for a home, most buyers always want to find a dream home with every item on their wish list. When you are house hunting, here are some criteria to decide if it is time for that forever home or a for-now one.
The biggest determining factor for most people is their budget. Can you afford a dream home, or is that something for the future? And be realistic on what dream home you will be able to afford in the future based on your current income and savings. Because real estate typically appreciates in value, with some big, noted exceptions, many homeowners buy a home with a mortgage, and as the value and their savings increase, they can sell the home and upgrade to a better one in the future. I always advise buyers to consider their monthly payment versus the purchase price, be comfortable with what you will be spending each month.
If you are single, buying a home more suited to a family of may not be sensible. In those cases, you are better off buying a “starter home,” maybe even a condo, PUD or small house, then later upgrading to a bigger home once you need the extra space. However, if you find a great deal, there is nothing wrong with buying a longer-term home. Just keep in mind that more expensive homes typically have higher property taxes, and your dream location may change in the future as your family or status changes.
If you are a young partier, why not live close to downtown or where you can get to a the Bay Area quickly while you’re young and save the house in the suburbs for later? Location is one of the top criteria for almost every buyer I work with, so you should always weigh the pros and cons of any home location: Is it good for now, for five years or even longer.
If you are going back to school to upgrade your career, you may want to move for a better job in the not-so-distant future. If your job is stable and it’s one you enjoy, your career shouldn’t stop you from buying a home. If you predict any big changes in the near future, you should hold off on buying a forever home, or any home, until everything is sorted out.
Some people just like to pick up and move. That’s OK. But if you have that tendency, paying closing costs to buy and sell homes frequently can quickly drain your resources. If you are moving around regularly, hold off on buying a forever home until you find a place you are ready to call home and set up roots or consider buying as an investment and renting out your starter home when you find your forever home.
Buying a forever home or a for now home
Whether you are looking to buy a forever home or something else, talk to a trusted, qualified Realtor and mortgage professional to help you get started. Remember, this is your investment and you should always feel good about making the right decision.