“Don’t buy a home in the heat of the moment that you haven’t planned for, because you could put yourself in a financial bind,” says Travis Gatzemeier, a certified financial planner at Kinetix Financial Planning. That’s one of the most common mistakes he’s seen clients and friends make, Gatzemeier says.
Many people are drawn to thinking it’s a good time to buy a home because of the current low mortgage rates, or societal pressure due to their age.
Avoid this mindset, he says, and ask yourself if you can reasonably afford a house.
“Do not buy a home just because you think interest rates are low and people are telling you it’s a good time,” he warns. “People think if you’re renting, you’re throwing away money. But that’s not necessarily the case.”
You should buy only when you have the financial means to do so. And the first thing you should be aware of is that you will need a sizable down payment.