After newlyweds say “I do” on their wedding, it is now time to also say “I do” to other major financial responsibilities. One of the major expenses for most couples is their house preference, and it is always a big question whether newlyweds should purchase a home or rent an apartment in the meantime.
Whatever the answer may be, the major key to your housing option is your finances. Chances are you have enough money to rent an apartment or you’ll probably get a cash loan to purchase a new home. To help you make an informed decision, check these guidelines and come up with a smart plan to manage your money.
Plan the Future
When making decisions, talk with your partner or spouse and envision your life together in three to five years. If you are planning to move to another state or change careers soon, factor in your choice of property or home. Obviously, if this is your situation, renting would be best for you.
However, Americas Housing Alliance says that purchasing a home and keeping it until it appreciates is an effective way to increase your personal wealth. This is much better than selling a home immediately, which can cost you money in the short term. If you have long-term plans to cash in on your home investment, it would be good to purchase a home now.
Examine Your Finances
Is your credit in good shape? You should know where you and your partner stand in your credit scores and debt. Many young couples use their wedding cash gifts or loan from their parents to raise the down payment for a property. In doing so, consider other expenses as well. These might include your property taxes and insurance if you prefer to purchase a home.
It would also help to consider the direction of prices of the real estate you are planning to buy. Studies say real estate prices in the US will continue to rise in coming years; buying a property will take a large chunk from your budget, but will also gain higher ROI for you. However, if you prefer to rent an apartment, rentals are more flexible.
Some newlyweds think having a home of their own early on in the marriage will make their union more complete. This may be true for most. But couples without much monetary buffer may end up with a home they cannot pay for the future, and end up having more financial problems than they started out with.
Being newly married is an exciting stage of life. A stage that comes with greater financial responsibilities, though. When choosing the type of home you and your spouse or partner will start your new life in, the key is to make sure your joint finances can support the value of your dream home.