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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 have 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 and 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.
copyright 2000 by Terry Light and RealEstate ABC
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