When you were growing up, there were probably certain milestones that you imagined you would reach in your adult life that would be momentous and important. Falling in love and getting married are on that list of milestones for most people, as is the dream of one day owning your own home.
As the age at which Americans are getting married slowly creeps up, the question has begun to emerge: Is it better to buy a house after you get married, or should you try to get your foot on the property ladder earlier, in your single life? Like so many questions surrounding real estate decisions, there truly is no single correct answer. The best decision for you will depend on your life circumstances, your career, your plans and dreams.
Before you decide to buy a home (or decide not to buy a home) as a single person, think about these things and ask yourself how they apply to your life and situation.
How stable is your career?
Like it or not, your financial picture is going to be absolutely critical in your decision — or ability — to purchase a home. This is true for anybody who’s trying to buy a house, but it’s doubly true for single people seeking to buy because you only have one source of income: yourself. You don’t have a spouse with better credit or a higher-paying job to help you out — or even a spouse with a lower-paying job that’s still contributing to the household. This means that your finances, credit, savings, assets and liabilities, and everything else that you have to put together to apply for a mortgage loan should be in a squeaky-clean condition so you can get the best deal possible on a loan.
This isn’t news to most people who are considering buying a house, but what they often fail to consider is the long-term stability and viability of their career. Or they might not even plan on staying in that career for much longer. If your master plan in life is to buy a house and then become an Instagram influencer while renovating it … well, that’s a lovely dream, but it also means that this most likely is not the best time in your life to be considering a major purchase with a loan that you’ll be paying off for well over ten years.
Objectively assessing your own income and earnings — and the probability that your skills will still be in demand in the years to come — is never easy, but think about the alternative. The worst-case scenario is not that you won’t qualify for a mortgage loan; it’s that you will and will use it to buy a house, then lose your job. If you’re working in an industry where the hiring process is long and convoluted, or if there aren’t a lot of alternative employment opportunities near you, then you’ll want to face this worst-case scenario head-on. What would you do if you were to lose your job while you were paying off a mortgage loan? Do you have other skills you could fall back on if that happened?
It may feel morbid to make a plan for how to handle a career tanking that never actually happens, but it’s so much better to be prepared and not need those plans than for life to catch you flat-footed and annihilate your ability to own a home in the near future.
How happy are you in the area?
Let’s say that your finances are in solid order and you know that you have job stability in your area for many, many years to come. Great! Maybe you’re ready to buy a place to live somewhere — the next question is, do you already live in the market where you’ll eventually want to buy?
You won’t be locked into homeownership forever, of course; you can always sell. But if you want to sell your house before you’ve been living there for two years, you will likely have to pay hefty taxes on any profit you make from the sale. So if you don’t think that you’ll be in the same area in two years, it’s probably best to keep saving up your money and wait to buy a house somewhere else.
That two-year window is far from a guarantee, however. Home prices generally rise over time, but that rise consists of pockets of peaks and valleys. If you happen to buy during a peak, two years later could be the midst of a valley, when you’re more likely to lose money — or at least not make as much as you could have on your home sale. Ideally, you’ll want to stay as long as it makes sense for you and your lifestyle, so if you’ve toyed with the idea of moving to a different metro area or an entirely different state, it might be wise to hold off on your home purchase.
What does your ideal living situation look like?
Some people enjoy having roommates while others prefer to live all by themselves. And some only want to cohabit with romantic partners or family members. Think about what you want out of an ideal living situation; it might not be possible to achieve immediately, but if you’re going to buy a house, then you should try to get as close to that ideal situation as you possibly can.
The easiest scenario to navigate in many situations is living alone; you just have to determine how much room you need, where and what you can afford to buy, and move forward from there. If you want roommates, things get a bit more complicated. Do you already have those roommates identified, and if so, how long-term are they? If there’s a chance that you may have to look for new roommates while you’re living in your residence, then you should think about the areas that are most attractive to the types of people you’d most like to have as a roommate and target them for your purchase.
Think through future options?
Buying a house when you’re single can be a smart investment if you think through the decision and make sure you’re choosing a home that will work for you for at least a few years. If you end up pursuing marriage, you’ll have equity built in your home and can use your first purchase as a foundation for a family home where you’ll live for years to come. Additionally, you may have the option to use your home or your future spouses home as a rental property and earn passive income for years to come.
If you are still trying to figure out if home ownership is right for you, reach out to a local realtor to help you process through your options.