Skip To Content

    What to Know When Deciding When to Buy Your First Home

    When’s the best time for you to buy your first home? Find out today.

    Looking to sell your home? Click here to use our free home evaluation tool.

    Looking to buy a home? Click here to search all houses on the local MLS.

     

    Within the past month, I’ve had two team members (both in their 20s) sell their first homes in order to buy their second homes and accommodate their growing families.

    This made me think: When is the best time for you to buy your first home?

    Most people would rather own a home than rent one, but what they don’t know is that the median homeowners’ net worth is 44 times greater than that of a renter ($231,000 compared to just $5,200). How can this be? Homeowners must make a monthly mortgage payment, and while part of that goes toward paying off the interest, part of it also goes toward paying down the loan, which acts as a forced savings account.

    Second, homeowners can take advantage of rising prices over time. While they own their home, its value rises, their paper value rises along with it, and they get to cash in on that value when they sell.

    The median homeowners’ net worth is 44 times greater than that of a renter.

    Third, when they sell the home, they can do so tax-free. If they’ve owned the home as their primary residence for at least two out of the last five years, all the money they make off its sale is tax-free. You can then do whatever you want with that money—put it into a savings account, start your children’s’ educational fund, etc. 

    So, when determining the best time for you to buy, there are a couple factors to remember. 

    First, you need to be sure you’ll live in the home for at least two years. This will give you time to take advantage of increasing home values. That will put you in the best position when it comes time to sell. 

    Second, make sure you’ll be able to set aside monthly funds outside of your mortgage payment so you can pay down other debt and maintain the home. The worst thing you can do is buy a home and have no money left over to care for that home. When it comes time to sell, you’d hate to have to put a lot of money into getting it ready for the market, so do that while you’re living in the home and enjoy being a homeowner while you build your net worth. 

    If you’d like to get the home buying process started or you have any other real estate questions, don’t hesitate to reach out to me. My team and I would love to help you. 

    Trackback from your site.

    Leave a Reply