If you look at a home as an investment, good for you.
And for the most part, that’s exactly what it is. Buying a house was always on the opposite end of the financial spectrum from renting, which was always associated with throwing money away or paying for something that ultimately wasn’t or won’t be yours.
But just because a house is a good investment doesn’t mean it is always going to pay dividends for you over time. Yes, as you pay your mortgage and fix the house up, you’re adding value to it, while also lowering your loan amount, adding equity to the home itself.
That said, if you’re going into the home buying process and are looking for or don’t mind a fixer upper, because you know what that entails, then so be it. You know what you’re getting into.
For some, however, they’re right on the cusp financially to be able to afford a home: they have saved for a down payment, they have money leftover for emergencies on top of that, but they really aren’t prepared for what potentially could lie ahead.
More trouble than one particular house is worth.
You can see, if you’re paying attention, from a mile away if the house you have your sights set on really is worth the investment or if it is constantly going to give you problems, one after another, to the point that fixing it might be more trouble than that investment is worth, at least on this particular home.
Even if you’re not a home inspector (or you’ve chosen not to have one), you can look for one thing that is a huge indicator that you should be running in the opposite direction: water. If you see water stained on the ceiling or collecting in other areas of the house, such as the basement, you should really be concerned about mold and other damage that could be happening as a result.
As a home owner who rents, you also want to use more than just your eyes to determine if you should buy. The smell of a home is paramount, so if you smell again mildew (water damage) or pets, you should be concerned. The smell of pets often is impossible to get rid of completely and ultimately will follow you, the new owner, around for the duration of the time you own the place.
No one is suggesting that buying a home isn’t smart. But if you’re buying a home that shows signs of being a flop versus a flip, so to speak, then don’t be afraid to go back to the drawing board and get something else, minus the headaches.
Previous: Late Bloomers: Can you be sure you’ll have right budget for retirement? Next: Effort-More: Why saving money comes so easily to some