Faster, easier payoff of your mortgage
The less expensive home will mean a smaller mortgage.
And that means it will be far easier to pay off your mortgage much faster.
Lower house payments will mean that you’ll have more money to make extra principal payments to accelerate the payoff the loan.
Is it better to buy a cheap house first?
Higher Cost Than Renting
Although starter homes are cheaper than larger homes, they still cost more than many rentals. You might be better off continuing to rent and investing the extra money so you can put it toward your forever house later on.
Is it a good idea to buy an expensive house?
Why You Should Not Buy an Expensive House. The findings show that the values of the most affordable homes increased by: 8.5 percent over the past year, compared with 3.6 percent for the most expensive homes. 44.4 percent over the past five years, compared with 26.6 percent for the most expensive homes.
Why you should not buy a house?
High Debt Ratios
Lenders change the rules all the time for debt ratios. If bills eat up 50% of your gross income every month, you probably cannot afford a mortgage payment on top of those expenses. Consider paying down or paying off your credit cards before buying a home.
Does it make sense to buy the most expensive house you can afford?
Re: Buying the most expensive house you can afford
Most likely (but not guaranteed), the payments will become more affordable as your career and salary progress. I’d also recommend a fixed rate 15 or 30 year mortgage so you’ll know the most you’ll have to pay for your mortgage each month.
Why you shouldn’t buy a starter home?
Why a starter home is one of the worst mistakes a new homebuyer can make. People buy starter homes to build equity instead of renting. But homes are more expensive than just their purchase price, and if you don’t stay in a home long enough, you don’t actually build much equity.
Is it worth buying a house for 5 years?
Defeating the Five-Year Rule
The biggest factor is how much you’re going to pay on your mortgage. A lot of people buy as much house as they can afford, according to what lenders offer them. You may also consider buying a house you won’t stay in for five years — but that you also won’t turn around and sell.