How Do You Know When You're Ready To Buy A Home?

Buying a house is one of the largest financial decisions of your life; but how do you know when you're ready to buy a home? 5 questions to help you find out.

Amber bought her home at 25 years old, almost immediately after I purchased my house. She couldn’t let her baby brother be the only homeowner in the family. After all, owning a home is the American dream, isn’t it? My sister proudly moved into her house and quickly filled it with more Ikea furniture than a Swedish hostel and the painted the rooms in all the latest colors, just like on some HGTV show.

Then the water pump broke.

Followed by a shower handle.

And then the snow began to fall on her pristine driveway, making it impossible to get to work one morning.

And this was all in the first few weeks of owning a home.

Living across the country, there was little I could do to help. My parents did the best they could to assist, but over the next two years my sister spent more time trying to fix problems than actually enjoying her home. Meanwhile, in those two years I picked up a half-dozen rental homes and even a large apartment complex and found my true calling as a real estate investor. Clearly, owning real estate was working out great for me, yet to my sister it had become an enormous headache.

I’ll share with you later just what happened to my sister and her house. For now, however, I just wanted to tell this story to illustrate an point: Just because you can buy a house, doesn’t mean you should. Buying your first home can be a great step in climbing the mountain to financial security or it could be a cannonball into the river of debt and despair.

So how do you know when it’s right time to buy a house?

I’ll tell you the secret: It’s not about “when” but “who.” Who are you? What is your position in life? These are the questions that will determine when you should venture into home ownership. It’s not about an age you need to reach first. It’s about a person you need to become before buying a home. Although I bought my first home at 21, others might wait until 41. Others may rent for life, and that’s fine. There’s nothing wrong with renting.

Owning a home does have advantages for building wealth in life, but I advocate asking yourself these five questions before choosing to buy a home. If you can’t answer yes to each of these questions, put off buying a house.

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