Buying a Starter Home

Many people have heard the term “starter home” if you haven’t a starter home is a home that most people purchase for their first house. It is usually a smaller home that needs some work, thus it reduces the price making it a bit easier for first time home buyers to purchase. These houses used to be very common on the path to home ownership. You buy the starter house, live in it, make upgrades here and there and after maybe 5-10 years you find it’s time to sell for that perfect home you’ve always wanted. But is the starter home starting to shift away from being an attainable goal for homeownership? It all comes down to what is affordable, let’s say you are buying something for yourself, the general rule of thumb is that the price tag on your home should be about 2.5-3 times your annual salary. So if you make $60,000.00 a year the home you purchase should cost about $150,000.00-$180,000.00. Now in today’s market, it can be fairly difficult to find something at that price range that isn’t far out of town or that isn’t run down and not really worth a purchase. So this means that a lot of people are waiting until they find a partner to make a purchase, because if you have two $60,000.00 salaries that means you can purchase the homes that are in the $300,000.00-$360,000.00 price range. This is a much more attainable goal and will give you a wider variety of homes to choose from. With that in mind is it worth buying that starter home that is going to need some work or do you wait, save up for a bit and buy that $400,000.00-$500,000.00 home that you are going to stay in forever? That is a question that everyone must ask each other individually. Can you plan that far ahead in the future? Will you ultimately be able to afford the extra costs that come with that more expensive home? It takes a lot of deep thinking and self reflection but you will figure out the answer. Only you can decide what home you want to live in.