I’m a single 26-year-old who’s been renting in downtown Atlanta for almost 5 years and want to buy my first home. My lease only allows me to enter the market once a year. If I find a deal, should I break my lease, or wait and see what’s available? What should I be focusing on to determine what I can afford?
I’ve been wanting to buy an apartment in the city for several years now, and I finally feel as though I am ready to make that a reality, if it weren’t for this crazy market and ($$*&*) lease. The real estate market in Atlanta is sky-high right now, with what were $250,000 to $300,000 apartments in the city now going for $500,000 to $600,000. Because of the market, I made the difficult decision to delay my original plans to buy an apartment at the end of my lease in January, extending my lease another 13 months to February 2023.
The main issue is figuring out what I can afford, top-line and down payment. In 2021, my income finished around $300,000. I currently have around $100,000 saved for retirement, plus another $175,000 in savings and investments. I currently pay $2,400 per month in rent and have no other debt.
Having the ability to put as low as 4% down up to the standard 20% has my pricing search window wider than the state of Texas. Budgeting for a fixed monthly rent (soon to be mortgage) is easy, budgeting for my first down payment is not.
If I find a deal, will I be prepared to hop on it and break my lease? What part of the home buying process should I be focusing on to make sure that I buy something I will be happy with for more than a couple of years, while remaining financially stable?
Or… should I just keep renting?
Your Inexperienced First Time Homebuyer
With a choice as monumental as whether or not to buy a home, it’s smart to approach the decision carefully and by doing a good amount of research. But many of us — myself included — can find ourselves stuck, ruminating on the endless possibilities. There’s a fine line between careful consideration and analysis paralysis. I would hazard to suggest that you may have crossed that line.
I’m not suggesting you rush out and buy the first apartment you see. Rather, I think it’s easy to overwhelm ourselves with a mountain of questions. So let’s boil down your concerns to a few key considerations:
- Should you save more before buying?
- Should you break your lease to buy an apartment?
- And, well, should …….