If you decide to buy a place in your 20s, you’re going to have to make sure that you know what you’re getting into. I’ve already stressed what a huge investment buying a home in your 20s. It’s likely going to tie up the majority of your savings and lock you into a certain area for a long period of time. You really need to take this decision seriously and understand what you’re about to get yourself into.
What should you watch out for with your first home purchase?
Don’t skip the home inspection.
You need a home inspection. You want to know what’s happening with this place that you’ve invested most of your savings into (or are considering investing your money into). You also need to know if it’s even worth buying the place at all. You don’t want to move in and then find out that you need a new roof.
Here’s a quick story on the importance of a home inspection:
My buddy Roman just purchased a place. It was an older home and he felt that he definitely needed a home inspection. It turns out that the inspector found out that he needed to make some modifications to the place. Instead of running away from the property, Roman chose to ask for a lower price. He stated his reasoning for the lower price and it was granted. Fortunately, he’s also good with DIY projects and the modifications to the home won’t be a problem for him. I on the other hand would run away form any DIY work.
Do yourself a favor and pay for the home inspection so that you know exactly what you’re investing your money into. The best way to buy a home is to wait until you have everything in order.
Don’t finance too much other stuff at once.
It’s tempting to want to improve your whole life at the same time. When you get a brand new house, you might get sick of that old car that you’ve been driving around since you were a broke college student. You might also want to finance that brand new flat screen.
The problem is that you don’t want to finance too much at once because you’ll tie yourself up to a bunch of stuff. This can also hurt your credit score because you’ll owe more money than ever before.
Avoid too many big changes.
You don’t want to quit your job and start your own business right as you move into your place. If you make too many changes at once, you’ll run the risk of creating far too much stress and anxiety for yourself. You want to have fun and weekend parties in the summer with your new place. You don’t want to lose to your mind from all of the stress.
Don’t assume that you’ll be making more money in the future.
It’s common to assume that you’ll make more money next year and then even more money the year after. You don’t want to be pessimistic and think that you’re going to make less money. There’s just one issue with assuming that your income will increase: you could start to overspend today.
It’s easy to justify purchases today by telling yourself that you’ll be making more money in the future. This is what college students do fairly often. The breakdown occurs when you (and if) you notice that your income is the same, while your expenses have skyrocketed.
Get advice from friends.
If any of your friends have purchased a home recently, you can ask them for advice.They’ll steer you in the right direction and help you make the best decision possible based on knowing your true personality.
That’s what you need to watch out for with your first home purchase. It’s your money and nobody will ever care about your money as much as you do. This is what it’s important that you take your first home purchase seriously. Are you ready to buy that first home?