Five Reasons to Not Buy a Home

Posted under: Quality of Life in Orlando, Home Buying in Orlando, Rent vs Buy in Orlando  |  April 19, 2011 5:30 AM 

Below are red flags that you may want to ponder before plunging into buying a home. Any one of them can stand alone as a reason not to buy a home. It might still make sense to buy a home if one of these situations applies, but more than one should definitely raise a caution flag.

#1 Reason to Not Buy a Home: Little Job Security

If you have reason to believe that your job may be in jeopardy, now is not a good time to buy a home. Many home owners who go into foreclosure end up in that position because they have lost their jobs. Unemployed individuals often place priorities on buying groceries and putting gas in the car over making a mortgage payment, hoping they can make up the mortgage payments later. Instead, they tend to go deeper into debt.

#2 Reason to Not Buy a Home: Tend to Move Every Year

Buying a home is generally a long-term commitment. If you love the excitement of new digs, which makes you want to constantly change your environment, you may find that it's impossible to sell your new home in a relatively short period of time without absorbing a big loss. The reason many people buy a home is to build equity, and it's very difficult to build equity if you're buying and selling at the drop of a hat, especially in areas where appreciation is little or none.

#3 Reason to Not Buy a Home: Unstable Relationships

Although many single people buy a home, often a home buying purchase is made with a partner or spouse. If your relationship with that person is unstable, what will you do if you're relying on that person's income and support to make the mortgage payment, and that person vanishes? At that point you could be facing a short sale or, at the very least, a loan modification, both of which affect credit.

#4 Reason to Not Buy a Home: Constant Traveling

Let's be serious here. If you travel all the time, why would you want to buy a home? Condos are a good choice for people on the go; it's called a lock-and-go lifestyle and other owners in the condo community can watch over your space, unlike a home.  

#5 Reason to Not Buy a Home: Everybody Else is Doing It

It's a fact that in seller's markets, buyers often end up in multiple offer situations. That's because in those markets, inventory is tight and demand is high. When you buy a home in a seller's market, you have little negotiating power and often will pay more than list price. You'd be much better off buying a home in a buyer's market, when there are fewer buyers competing for larger amounts of inventory. You don't always have to follow the crowd to make a wise financial decision.