Should you buy a house in your 20’s?

SALA Financial Services > Articles > Should you buy a house in your 20’s?

Do you want to be young and free? To have the freedom to move around the world? To go on holiday five times a year and not have to worry about saving money?

Then buying your first house is probably not the right choice for you just yet. That’s fine, there’s nothing wrong with wanting to experience life while you’re still young.

– Life begins to revolve around where you live

When you buy a house, you’ll plan on living there for a few years. That means you start to put down roots, and your life will start to become more fixed around a smaller area.  It’s not necessarily a bad thing, but it does mean that you’re probably going to have to put a stop to going out every weekend.

You may also find yourself limited when it comes to your job.  What if you got offered a much better job, but it was a 2 hour drive away? If you were renting, it would be pretty easy to move. You’d just rent another place closer to your place of work. When you own a house, you’ll go through all the questions:  should you sell, should you rent the place out, should you take the job, what if you just drive all that distance every day?LifeBalanceWantsandNeeds

– Less money to spend on other big expenses

New car? Holidays? Extravagant Christmas?  They may now play second fiddle to your house. What comes first- paying your mortgage, or buying extravagant gifts and planning expensive overseas holidays.

– Sacrifices made to save the deposit

Budgeting becomes a way of life when you’re trying to save money for your deposit. You have to start paying close attention to where your money is haemorrhaging from, and often you’ll find that the most fun aspects of your life are costing you money and a lot of it.

If you’re saving for a deposit, you have to cut costs. It’s just how it works. So sorry, but the reckless spending must stop. If that’s not what to want yet, then don’t do it.  Enjoy being young, and hold out on the house-buying for a few more years.

– Maintenance, insurance, running costs

Here’s the one that a lot of renters forget. ‘The landlord takes all my money and gives me nothing in return. I’m paying off their mortgage”

OK, you’re partially correct. You’re paying their mortgage. But the ultimate responsibility of the house falls on their head. Who’s paying to insure the building? And who’s responsible when the whole place needs gutting and redecorating? The owner.

And when you own your own place, that owner is you. You’ll be paying all of the insurances, taxes, and additional maintenance costs.  They can easily add up to hundreds of dollars every month, and that’s over and above mortgage payments.  That’s the reality of owning a house. Things break, and you have to pay for them to be replaced. Floods happen.   The place needs a new kitchen and bathroom. And the costs all fall to you.

What are your priorities?

We can weigh up pros and cons all day long, but if buying a house isn’t on your priorities list, it’s simply not going to be the right decision for you.

If you were to write down your big three goals to achieve before you’re 30, would buying a house make the cut?  If not, then I’d say it’s not even worth you trying to do it, because your heart won’t be in it.  Only you know whether you should do it. Don’t listen too closely to what anyone else says is right for you; it’s an incredibly personal decision.

If you decide not to buy until you’re older, that can also be a very wise move. Odds are you’ll be much more stable, and may have a bigger deposit.

Read original article here.

Leave a Reply

Your email address will not be published. Required fields are marked *