Buying & Selling - Deciding to Buy

Deciding to Buy

Buying a home is a major undertaking. Before taking the plunge,
make sure that you've thought it through and are ready to
proceed.

Consider your motivations for buying to help determine if you are
really ready to enter the market.

Personal Considerations

Think about your personal reasons for moving. Do you need a
larger home to accommodate a growing family? A shorter commute
to work? Don't forget to consider the difficult aspects as well. Are
you emotionally attached to your present home - will it be painful
to leave? Being mentally and emotionally prepared is the first step
toward a well-conceived and well-executed move.

Do You Feel Pressure to Move Now?

Do you feel that you'll be priced out by a rising market if you don't
buy now? Or are you afraid you'll miss bargains in a troubled
market? Review our tips for evaluating real estate markets to help
you decide how to proceed.

How Long Do You Expect to Own Your New Home?

Buying or selling a home is an expensive and involved process.
Closing costs alone can amount to 4-8% of the sale price - for
both buyer and seller, making a home purchase financially
unattractive unless you plan to own the property for several
years. Remember that you'll face another round of closing costs
when you sell; so your house will have to appreciate 8-12% just
for you to break even.

Assess Your Financial Condition

Do you have enough cash to fund the down payment and closing
expenses? Can you comfortably afford the mortgage payments as
well as taxes and insurance? Do you have any credit problems?
Review our affordability guide to help you get the answers.

Homeownership as an Investment
While markets can be turbulent and values occasionally decline,
owning a home remains an attractive investment over the long
term. Additionally, don't forget to consider the tax advantages of
homeownership - mortgage interest is deductible and profits from
the sale of a home are usually exempt from capital gains taxes.