Catherine Wilson | Wilmington Real Estate, Tewksbury Real Estate, Billerica Real Estate

The house is perfect. Size, location and design of the home fits your personality and your lifestyle to a tee. As if to crown all of the advantages associated with the house, the neighbors are friendly, responsible and fun.

When staying away from owning a new house may be best

Each time you've stopped by the house, at least two neighbors spoke and waved a heartwarming "Hello". Not a single neighbor was guarded when you asked them about schools, shopping, social events, community organizations and worship centers in the area.

Property taxes in the new neighborhood are also good, lower or not much more than what they are where you currently live. Yet, as perfect as it seems, buying a house now is a bad choice. In fact,  it may be best to postpone buying a new house if you meet one or more of the below criteria:

  • You just filed bankruptcy and your disposable income is too tight for you to take on the responsibility of owning a used car or a new furniture set. If you can't keep up with payments on these smaller items, it's highly likely that you can't afford to buy a new house.
  • Houses where you currently live are selling slowly. You'd take a loss of several thousand dollars, perhaps more than $25,000, if you sold your current house now.
  • Interest rates are rising two to three times a year. Your credit would make it hard to secure a fixed interest mortgage. You could save $100 or more a month if you wait until interest rates lower or your credit score improves.
  • In a few years, your household size will change. For example, adult children may leave home for college or may be in the process of saving enough money to buy their own house. Once your adult children move out, you'll need a smaller house.
  • The environment as your job is shifting. You're not certain that you will still be with your current employer in a few weeks or months when you suspect that your current employer will do a layoff.
  • Although you're going through marriage counseling, your relationship is experiencing deep challenges. You're not sure that your marriage will survive the challenges. Buy a house now and you may have one other piece of property or equity to let attorneys help split between you and your former spouse, should your relationship dissolve.
  • Recent investment that you've made have squeezed your finances. For example, if you started a new business, it could take two or more years to generate enough income from your business to take on a mortgage.

A well built house last for decades. This gives you time to sharpen your financial portfolio before you buy the house that you love. As tempted as you are to punch the button and take on a hefty mortgage just so you can live in a house you want,if you buy the house before you're financially ready, you could regret the decision for years.