Tory Dunlop is a financial influencer, blogger and podcaster. She focuses on teaching women financial skills and making a good living through them. In a recent episode of his podcast, financial feministDunlop notes that buying the house was (almost) his biggest financial mistake.
The notion that such a cornerstone of the much-lauded American Dream might be a bad idea might come as a surprise to some, but I knew immediately where Dunlop was coming from; after all i did Buy a House in My 20s and It Became my biggest financial mistake, Dunlop offered four reasons why she’s glad she didn’t buy, even though she could afford the house she almost bought, and in fact, she still rents. Why over here
The COVID-19 pandemic changed the face of American life in many ways, including pushing many to rent and buy homes. This increase in demand, coupled with historically low interest rates, led to an increase in home prices. According to data from Redfin, in July 2022, the median selling price of a US home was $412,198. And in some markets, it would actually be considered too cheap.
Tory Dunlop is based in the Pacific Northwest, and as she notes in her podcast episode, her job, friends, and social life were based in downtown Seattle, a notoriously expensive metro area. She couldn’t afford to buy in Seattle, so the condo she was attempting to buy was located in a more affordable area, more than an hour outside of downtown. It took her a long way to get to and from work, and away from a city that had great restaurants and other opportunities to have fun.
If you’re wondering if homeownership is for you, ask yourself: Will buying this property mean that I have to give up the aspects of my life I love as a renter? Maybe you really hate doing yard work, and if you buy a house, you have to maintain a green space. Perhaps, like Dunlop, you can only buy property away from the city and the people you love. In these circumstances, it is absolutely right to skip the purchase.
2. HOA Mismanagement
Dunlop was looking to buy a condo instead of a single-family home. It meant she would be admiring for a homeowners association, or HOA. In condos and similar communities, HOAs provide rules governing life for those homeowners. They are also often responsible for outdoor and common area maintenance. People have strong opinions on HOA, and with good reason – I know I don’t want to pay extra money and have someone tell me what color I can paint my house or what pets I can have can. To be honest, this self-determination is one of the biggest reasons why I hoping to buy a house myself in the near future.
Dunlop found that the HOA for her soon-to-be condo was ineffective and poorly managed, and neglected tasks such as gutter-cleaning, while the HOA disputed and wasted money.
3. Emotional readiness
Buying a home is a huge decision, and not just from a financial point of view; Emotional thoughts are also included. And as a young 20-something, Dunlop just wasn’t ready to be a homeowner.
Homeownership involves spending more money, more energy, and more time maintaining the property than many people may realize. And it is also committed to stay in a certain area for some time. The longer you can live in the home you bought, the more likely you are to actually make money on that property when you sell it. Hiring is a more sensible prospect If you are not organized enough in your life or career to meet this commitment.
4. Real Estate Agent Issues
The ultimate reason Tori Dunlop is happy that she didn’t buy is that she didn’t have a good real estate agent working for him. The agent was not supportive of her efforts to negotiate a price (which is a big red flag!), and seemed more interested in getting her commission on the sale than making sure the purchase was right for her customer. was being
A good real estate agent should be your biggest advocate in the home buying process, and if you’re not going to mesh with an agent, definitely find a new one. And if during house hunting, you find out you’re not ready yet, a good agent will respect that. If you find a good agent, reevaluate your life over a few years and see if you can ever work with them again if you’re ready to buy.
Buying a home is something that many people dream of, and with good reason. But buying just because you have the money, and because you’ve accepted the old adage that homeownership is “the key to wealth,” is a bad idea. With a consequential (and expensive) decision like this it’s best to take your time and really think about it, like Tori Dunlap did.
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