4 Terrible Reasons to Buy a House

Buying is a personal decision.

I feel as if I say this a lot, but homeownership is expensive and not right for everyone at every stage of life. Despite the societal reputation of renters as often young, irresponsible, and "not real adults," renting a home is absolutely the better choice in a number of situations. If your career isn't settled, you have little or no cash savings, or you have no clue how to handle home maintenance issues (sometimes "handling them" just means calling a plumber or electrician -- then paying them), you shouldn't buy a home.

I am currently 0 for 1 on successful homeownership, as I bought my last home when I was young, mostly broke, and still in a career that demanded relocation for advancement. That experience ended poorly. Now that I'm hoping to buy again in the near future, I've thought long and hard about why I want to own a home, and what it will mean for my life and my finances. If you're considering buying a house, I urge you to do the same -- and don't rush to get a mortgage if any of the following is the reason why.

1. Someone is pressuring you into it

If you're leaning toward buying because another person is pressuring you to, that's not a great situation. First of all, buying and owning are personal, as are your finances. If someone (like a friend or family member) who doesn't have a financial stake in you is telling you to buy a house, you should push back against that. Why is it up to them? It's not their money or life!

You might be in the unenviable position of disagreeing about homeownership with a spouse or partner, however. If the person you share finances with wants to buy and you don't, it doesn't mean you need to give in. Your opinion (and money!) counts in this situation, as in all others. Have a calm discussion about why the other person wants to own a house so badly, and bring up your objections (the cost, the hassle, work concerns, etc). If you can't come to a consensus, consider talking it out with a neutral third party, like a counselor. But don't buy a house because someone is forcing you into it.

2. All your friends are buying homes

Sometimes you'll fall victim to peer pressure -- it's just part of life. Unfortunately, buying a house because it seems like all your friends are, even though it isn't right for you, is a very expensive potential mistake.

Take a step back and observe how your life and that of your friends who own homes differ. Maybe your friends earn more money than you do, or are more settled in their careers and therefore less likely to need to move soon. Maybe they're expecting a baby and want more room to spread out. You definitely don't need to keep up with the Joneses, especially when it comes to the most expensive purchase you're ever likely to make.

3. You think it's the only way to attain wealth

If I've heard it once, I've heard it a thousand times. "Renting is throwing money away." "Homeownership is the key to wealth." No. No, it's not. Okay, yes, owning a home can be a great way to become wealthier over time, as you can build equity in an asset that often appreciates (but not always). You can also build wealth by investing the money you save as a renter. Yes, this will take more discipline than paying a mortgage every month. But in the end, you'll have built wealth -- and what's better, you won't have to sell a home to access it.

4. You believe it's cheaper than renting

Boy, I know this feeling. You're chatting with friends, and mention how much you pay in rent, and they laugh and say their monthly mortgage payment is far less than your monthly rent. It stings in the moment, for sure -- but you're not getting the whole story. Your rent payment isn't the same as a mortgage payment, which is why in most cases banks don't consider rent in deciding to give you a mortgage loan.

Plus, you didn't make a down payment on your rental -- you most likely paid a deposit of a month or two of rent. And if something breaks, it's not generally going to be on you to fix it, that's why you pay rent to the owner of the property: your landlord. And you won't pay the property taxes, either (and these can climb over time). Research from The Ascent found that renting is cheaper than owning, despite rent payments often being higher than mortgage payments.

With all this in mind, I hope you've thought long and hard about your needs, wants, life, and finances if you've decided to buy a home. Buying for the wrong reasons can cost you in more ways than one.