For most folks who decide to do so, buying a home is the among the most significant transactions they’ll make in their lifetime. As a result, it is a high-pressure transaction. Ahead of our search, we emailed a few friends who’d bought recently and asked them to share their advice. Over time, I’ve since dispensed said advice and refined my own. My current synthesis has 3 notes –
(1) Picking a budget is a critical decision – pick an amount of debt that doesn’t add too much pressure for too long: Unless you’re wealthy and have no need for financial advice, your mortgage will change how you approach the next few years of your life. Some change is par for the course. But if it constrains your freedom and optionality (e.g., by making you feel too tied to your current job) for too long, it can become problematic quickly.
Buying a home is a lovely thing. It helps to budget for it in a way that it doesn’t become the only lovely thing you can afford in your life for the foreseeable future.
(2) There are things that can be easily changed and things that can’t – pay attention to the latter: There’s a lot about the look-and-feel of the house that can be changed. Floors can be changed, rooms can be redone, and bathrooms can be remodeled. These are problems that can solved with money.
On the flip side, problems that aren’t easily solved with money are structural issues in the home (especially those involving mold), a problematic homeowner’s association, and those involving the neighborhood – e.g., bad neighborhood schools or crime. Buying an okay home in a great neighborhood typically trumps buying a great home in a bad neighborhood.
(3) There is no such thing as a perfect home – instead, there is a great choice out there for you at this time with trade-offs you’re happy to live with. Assuming money is a constraint (see (1)), the home-buying decision is an exercise in trade-offs. You can’t have everything – you’ll have to just choose among the inventory available at any given time anyway.
If you want location, you’ll have to give up space. If you want space, you’ll have to do the work to maintain it. If you want a lot of space at a great price, you’ll likely have to make peace with a commute. Or if you decide you don’t want to deal with these trade-offs, you’ll have to wait a while before you buy – that’s a trade-off too.
There’s no right or wrong answer here. The reason to buy a home is because we believe it will increase the joy in our lives. Joy doesn’t come without pain. We just get to choose the kind of pain we want to deal with.
Choose thoughtfully, then act decisively.
