Those who currently rent (rather than own) do so for several reasons. Many renters choose this housing option because:
- They are saving for a down payment
- They are unsure where they want to live
- They are waiting for career advancement so their income will support additional expenses
- They are uncertain if they want the responsibility of homeownership
However, these reasons overlook the benefits of homeownership.
Compare Current & Future Budgets
There are two budgets to consider when planning becoming a homeowner. First, assess your current budget (and your comfort level!) to gain an accurate understanding as to whether you can handle a monthly housing expense as a homeowner. The second budget consideration is to determine what is known in the industry as a price-point by assessing a) your available down payment, and b) the home’s potential monthly expenses. This analysis will help you decide just how much of a home you can afford. Mortgage professionals are a great resource for this analysis.
Homeownership Monthly Fees
When a renter pays their monthly rent, (and renter’s insurance), a renter’s financial housing responsibilities end there.
Homeownership requires additional expenses:
- Homeowner’s Insurance
- Lawn/yard upkeep
- Plumbing and electrical repairs, etc.
Prioritize and Compromise
It is exciting to be begin the process of homeownership. Like most homeowners, each of us has a list of items you want in your new home. Is it a pool? A fireplace? A large backyard? It is best to begin to prioritize these items into two groups:
- “Must Haves”
- “Would like to Have
When these lists are complete, the next step is determine the way in which to compromise so you get the most bang for your buck.
Contact Industry Professionals
Locate a trusted or recommended real estate agent to assist you with the necessary first steps. Experienced licensees are often great resources for attorneys, mortgage professionals and home inspector recommendations. Take advantage of their real estate experience and knowledge of the local market.
