We all know the American Dream, but who said that dream didn’t come with the occasional scare?
That is the case with home buying. Buying a home is certainly high on everyone’s bucket list, but there are certain aspects of home ownership that will surely frustrate even the handiest individuals.
Before you sign the contract and hand over that huge down payment, be sure to review our seven reasons to not buy a home.
When most people buy a home, they pay a 20% down payment to reduce interest paid on the loan. Whether you’re buying a $400,000 home or a $900,000 home, your down payment and reoccurring loan payments are certainly going to have a toll on your discretionary spending.
Before you purchase or build a home, make sure you are ready for the debt and required loan payments for years to come. It’s not so different from renting, but that huge down payment could certainly sway one’s opinion.
2. Property Taxes
Another aspect of home ownership that doesn’t come with renting is property taxes. All property owners need to pay their property taxes twice a year. As the markets continue to regain its position, taxes are expected to rise.
Before you buy, look up your property taxes and those of your neighbors. As long as you have the address or PIN number, your local Secretary of Treasurer’s website should be able to help.
3. Water Bills
More often that not, renters pay for electricity, gas, Internet and cable. Rarely, do they pay for water. Well, when you buy the home, like many other expenses, the water bill comes right to you.
Gone are the days of long showers, running the sink to warm the water or multiple laundry days. If you want to reduce your water bill, then you better be able to reduce your water intake.
Need some help? See Water Conservation At Home.
4. Everything Depends On You
When you purchase your first home, everything depends on you. When the hot water breaks, you can’t call your landlord to fix it. When you own a home, no matter what the issue is, you either fix it or pay someone to fix it.
If you are a savvy DIYer, these types of issues may not bother you. After all, painting an interior room and fixing a clogged toilet are both easy projects, but ones that have to be completed nonetheless.
Before you hire a local contracting professional, do yourself a favor and browse our DIY articles for simple fixes to the most common home remodeling projects.
5. Paying for All Repairs
There are those of you who flaunt your DIY status and then there are those homeowners who don’t know how to find a stud. Sadly, for the latter, you will frequently be searching online for a local handyman who can complete the job for you.
Whether it’s mounting a flat screen TV or planning the perfect man cave, hiring a professional is almost always more expensive than completing the job on your own.
Fortunately, we have researched the average prices for over 200 home remodeling projects. Check out our cost estimators to see what your next project will cost!
6. Dealing with Homeowner’s Associations
I grew up in a townhouse and personally know the drawbacks of living with a homeowner’s association. First off, there are dues you have to pay each month for maintenance issues such as landscaping, snow removal or roof repair.
Secondly, major and minor decisions that affect the outside of your home must be approved by the association. For example, if you want to paint your house a different color, the association has to be approve it. If you want to add a basketball hoop above your garage, the association has to approve it.
Before you buy a home or condo that is part of a homeowner’s association, make sure you know their constitution and talk to potential neighbors to see how strict the association is.
7. Little Flexibility
The golden rule of home buying is that you should plan on living in the home for at least five years. Otherwise, financially, it makes more sense to rent.
On top of financial issues, once you buy a home, there is no turning back. If a loud neighbor moves in, there is nowhere to go. If your new job adds 45 minutes to your morning and evening commute, you better get used to traffic.
As obvious as it is, when you buy a home, you lose the flexibility to move around or travel.
Buying a home is part of the American Dream, but with all dreams come a few scares. Make sure all the risks and situations above are worth the huge investment you’re about to make.
Ready for your first home. See some of the exact costs that come with building a new home!