Owning a house is every couple’s dream, regardless of their financial status or plans. There is something special about buying your first home as a married couple. With a volatile real estate market and astronomically high prices in some places, young couples might struggle to buy or build a home today.
However, owning your home is worth it, considering the freedom you will get and the intrinsic benefits attached to it. With a home, you can get tax benefits, improve your credit score, save costs, improve your social status, and so much more.
When Should Buy a Home After Tying the Knot?
Should you buy a house as soon as you get married so that you have somewhere to call home after your honeymoon or wait a few years to see how things work out?
The right answers to this question might vary from couple to couple. However, here are a few pointers of when to buy:
Buy When You Are Ready Financially
Nothing is more stressful than having to spend all your money on a mortgage as newlyweds or when you are just starting a family. You should only buy a house when you are confident that you can finance it. It doesn’t matter if the property market is attractive at that time.
Remember, being married does not have any tangible advantages in terms of credit. With this being the case, how do you know you are ready financially for a new home?
- You, your partner, or both of you can afford to finance the mortgage installments with not more than 30% of your monthly income. This will not only leave you with enough cash to spend but allow you to do other things that are important for a young couple/family.
- You are not in debt. Small credit card debts are acceptable. However, ideally, you shouldn’t be having any huge loans or financial obligations when you decide to buy a home. Student loan debt is a common challenge that many young couples face today.
- You can raise at least 15% of the price for the house you want to buy if you decide to get a mortgage.
- Your credit score will significantly affect the mortgage rate and how much money you will be required to provide as a deposit. While you might be married, mortgage rates are usually calculated based on individual credit scores and debt obligations.
- You should have a stable job or source of income before you opt to buy a house. Don’t fall for the low entry requirements mortgages or subprime loans that are peddled by some real estate brokers and financiers.
- You have alternative plans. What if the property market slumps and makes your house almost worthless? What if there is a real estate boom that makes it too expensive to live in that neighborhood? Do you have alternative financial plans or investments? It would help if you had home buying contingencies in place in case things don’t go as expected.
Are You Ready for Joint Ownership or Individual?
Married couples can choose to make a joint mortgage application or, in the case of cash buyers, contribute towards the purchase price and other expenses. Individual applications or purchases can be done at any time. On the other hand, joint ownership might require you to talk to your partner for some time to agree on the way forward.
If you are considering a joint mortgage or purchase, take your time and make sure you are in agreement with your spouse. There are situations where a joint application might actually raise your mortgage rate, for instance, when one of you has a bad credit score or is in debt. In such a case, an individual application could be the way to go.
Buy After Identifying Your Individual and Joint Needs
Choosing the perfect permanent residence takes time, compromise, and research. You might identify the perfect home but the commute times may not be favorable to one of you. Other factors like the available amenities, transport routes, and infrastructure should be taken into consideration. You and your spouse should take some time, say a year or so, to identify a location that favors and accommodates your plans and dreams.
For instance, if you haven’t decided whether or not to start a family, take time before buying a house. This is because kids come with their own needs, which might include hospitals, playing grounds, parks and kindergartens. Also, consider your individual needs, such as entertainment joints, gyms, parks, and social amenities.
Buying a house is a good step towards a long and happy marriage. This is especially true for couples dreaming of raising kids. Your children will have a permanent place to grow and call home, and you will not have to worry about the stresses of paying rent. As newlyweds, take time and research well to get the right home for you.