3 Red Flags You're Buying the Wrong House

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Your house is one of the biggest purchases you'll make in your life, so you don't want to make the wrong choice.

Buying a house is a huge financial decision. You'll likely need to get a mortgage for your home that you'll pay off for a very long time -- and it will cost you tens of thousands of dollars in interest. You'll also need to cover high transaction fees for the purchase, including closing costs that can be 2% to 5% of the purchase price.

You don't want to make the wrong choice and end up in a home you don't want to stay in, or that you can't afford. To reduce the chances of that happening, watch out for these three signs that you're making a purchase you could end up seriously regretting.

1. You're buying your house to impress others

Far too many people purchase a home just to keep up with the Joneses or to wow their friends and family. Unfortunately, those loved ones or friends on social media who you're trying to make jealous are not the ones who have to live in the house every day.

Buying a house that's designed to impress can leave you with bills that are too high, and with a property that's too large to easily furnish or maintain. The scale of the rooms may mean you don't feel cozy, and the layout may not actually work for your family.

Instead of focusing on what "looks" good, it's best to find a home that feels right to you and that works with your current lifestyle -- not the lifestyle you hope people imagine you have.

2. You're stretching your budget to the limit

Purchasing a home that's too expensive is also sure to lead to regrets.

If you buy at the top of your budget, your monthly mortgage payments may be difficult for you to make -- especially if something goes wrong. And you could find yourself unable to accomplish other financial priorities because so much of your money is going toward monthly payments.

A more expensive house can also lead to higher property tax bills, maintenance costs, and repair expenses. If your budget is already stretched to the limit, covering these expenses could be a big problem. If you're not sure how much house you can afford, use a mortgage calculator to play with the numbers.

3. You don't love the location

Most things about a house can be changed over time, whether it's the look of the kitchen or even the number of bedrooms. But while you can remodel or add an addition to your home if you need more space, you can't move the property to a better location.

As a result, the location of your home can be one of the most important features. You'll want a neighborhood you enjoy living in, a commute you can manage, and a school district you're happy with. If a home doesn't meet these requirements, you could end up regretting your purchase.

Make sure you keep your payments comfortably within your budget, buy a home that's right for you (rather than because it's impressive), and like -- or preferably even love --your home's location. That way, you'll end up with a property that's more likely to make you happy over the long haul.

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