Buy With Your Head Not Your Heart
September 20th, 2009When it comes to buying property, what does it mean to buy with your head not your heart? In a nutshell, it means to buy a property that falls comfortably within your budget and satisfies the majority of your needs more so than your material wants. Buying with your heart and spending over your budget can spell financial suicide as the costs of servicing your loan and maintaining your property start to add up.
Buying with your head and not your heart is especially crucial when looking to buy your first home. Buying your first home can be quite an emotional experience in itself while you try to find that ideal property you will not only call home but have to work hard to pay for, perhaps for many years to come. Sure it is nice to have a swimming pool, a double garage, maybe 4 or 5 bedrooms and 2 or 3 bathrooms but can you really afford all of this?
You need to consider the cost of interest when calculating the cost of repaying your loan and factor in the possibility that interest rates could rise significantly over the term of your home loan. If you are a couple with no kids and a dual income you might want to consider the possibility you may decide to have children and then have to service the loan on just one income taking care of at least three people as well as the costs of running a household.
Most people want to be able to enjoy their lives by taking a holiday once in a while or perhaps buying a new car, these are also factors worth considering when looking to buy property. Just because the bank gives you the green light to borrow half a million dollars to buy the house of your dreams does not necessarily mean you will be able to comfortably service a loan of that size for years to come. This is why it is vital to look at what you really need in a property and where it is located and consider all the other things that life may throw at you when choosing to buy.
Buying a house is a stressful time in your life, especially for the first time buyer, but it is also a wonderful time in your life whether you are a single person or a couple. It can feel like a dream come true when you finally get the keys to your property and move in to live. However, that dream can soon turn into a nightmare if you cannot afford to pay back the loan for any number of reasons. This can put an enormous strain on your relationship and cause massive stress in all areas of your life.
When you buy with your head not your heart you will make steady progress paying off your property and this will not only make you feel good about yourself and your home, it will put you in a strong position financially and who knows, you might be soon looking for an investment property to add to your portfolio. It can be a jungle out there in the property market place but wise choices can make you the king of the jungle.
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