Not Sure You’re Ready to Buy a Home?

Here are 5 things to consider to help you decide if the time is right!


When buying a new home, consider how long you will remain in that location. If your employment situation might cause you to relocate within two years, you may want to reconsider buying. Commissions, closing costs, and other fees will cost you around 5-7% when you sell. If you held the home less than two years, you will also have to pay capital gains tax.

Job Security

Similar to asking yourself how long you plan to stay in one location, if you are planning to shift jobs, careers, or if your employment is up in the air in general, you may want to put off getting that first or next home.


Your Debt-to-Income ratio should be less than 45%. To find your Debt-to-Income (DTI), divide your amount of debt, including a proposed mortgage payment, by your monthly income.


While putting 20% down payment is not strictly necessary, it is a good goal. Avoiding the 20% payment comes with its own costs. These costs could include Private Mortgage Insurance (PMI) an additional fee for high-risk borrowers. Remember that however much the sale turns out to be, there will be additional expenses involved.


Being a homeowner comes with more costs than just the mortgage payment. It is important to budget for home maintenance, or, if applicable, Homeowners Association fees. It is recommended the homeowners set aside around $3,300 per year for maintenance.

Read: How Millennials are Changing the Homebuying Process

Read: Sorting Out the Myths & Facts of Spring Home Buying

Read: How to Buy a Home, Even with Student Debt

Back to: How to Prepare to Buy a Home