Am I a Born Owner, or a Renter Through and Through?
Before buying your first home, ask yourself whether you want to buy or rent and what you are looking for. Here is a little questionnaire that will help you get to know yourself better.
|1.||Are you constantly moving house?|
|2.||Would you find it hard to live without a landlord when you have a maintenance, plumbing or electrical problem?|
|3.||Do you lose sleep over your financial obligations?|
|4.||Are traveling, buying the car of your dreams, or partying every night more important to you than owning your own place?|
|5.||Do you feel like you’re throwing money out the window every time you pay your rent?|
|6.||Do you stop yourself from redecorating your apartment because you don't own it?|
|7.||Does the homebody in you have a burning desire and the ability to take on a mortgage instead of rent?|
Are you eager to shoulder all the responsibilities that come with owning your own home, from decorating, to mowing the lawn, to repairs and renovations?
If you answered yes to any of the first four questions and no to any of the last four, you're not quite ready to buy a home. You should probably draw up a list of pros and cons before making a decision. If you're still not sure, here's a little trick to see whether you are ready to take on more financial responsibility: pretend that you have purchased a home and deposit a fictitious monthly mortgage payment into a housing savings account. Set the mortgage payment at 20%, 30% or 40% of your current rent. If you only last 6, 12 or 24 months, at least you will have put some extra money aside! Otherwise, you’ll have saved money for an eventual down payment.
If you answered yes to all of the first four questions and no to all of the last four, skip to the next step!
For a quick estimate of what you can afford to pay for your future home without changing your lifestyle, use our calculator to convert your rent into mortgage payments.