There are plenty of reasons to buy a home (you’ve been saving up your down payment, you know exactly what you want, you have a steady and stable job and aren’t planning to move in the next 10 years or so) and there are plenty of reasons not to (your credit is completely shot, you can’t commit to staying in one place or you have an enormous debt to income ratio). However, the line tends to gray a bit when people believe they have good reasons for buying a home, but they really don’t. If you find yourself justifying a home purchase with one of the following reasons, just stop.
1.) You’re in college and don’t want to pay rent. Are you kidding me? College is one of the most unsure, sporadic times of a young person’s life; so much can change! I don’t know a single person who has ended their senior year the exact way they started their freshman year. Very rarely (and I mean very, very rarely), are people still dating the same person they started with, studying the same subject (let alone the same major) they started with, and even attended the same school they started with.
So parents, I’m also talking to you here; do not buy a house in your kid’s college town because you think it will be a good investment and save them money on rent. It’s a horrible idea. Tell them to get a roommate, get a job and pay rent just like every other college kid in the world.
2.) Lifestyle. Are you sick of your landlord telling you what you can and can’t do? Think being a homeowner will grant you the freedom of doing what you want? Not so fast. Many neighborhoods still have rules you have to abide by, so even if you own the place you can still get kicked out for blasting your music at 1:00 in the morning. Homeowners Associations are notorious for being stricter than most landlords. If you don’t like your living situation, move, don’t put down a couple hundred thousand dollars on an impulse purchase.
3.) Because everyone else is doing it. It’s only natural to feel a little left out when all your friends start moving on to different stages in their lives, but it doesn’t mean there’s anything wrong with where you currently are in your life. Your friend may have much better reasons (and resources) than you for buying a house right now. Buying one at the same time so you can both talk about kitchens and bathrooms is a horrible idea.
4.) You find a good deal. Maybe you happen to come across an adorable little house in the part of the neighborhood you just happen to love right now, and it’s even in your price range! So what?! That doesn’t mean anything! There are much, much more reasons that need to enter your head before “a good deal” ever comes into the picture.