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A realtor walking his clients through an empty house and pointing out the window.

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Buying a house under these circumstances wouldn’t make sense.

Key points

  • Buying a house can be a good investment, yet in some circumstances, it doesn’t make feeling.
  • I would never consider buying a home if We couldn’t commit to staying there for at least a couple of years.

Over the course of my adult life, I’ve bought multiple houses . I really like real estate and becoming a homeowner was the huge priority for me. Once I made sure I had my financial ducks in a row, including a good credit score to enable me to qualify for an affordable mortgage loan , I bought a house as soon as I could.

Despite the love associated with buying homes , though, there is one situation when I absolutely would not purchase a home.  

I actually wouldn’t buy under these types of circumstances 

The one situation where I completely may not even consider purchasing a house is when I knew I wasn’t able to commit in order to staying in the particular property for at least two years.  

There are the few big reasons with regard to that. First and foremost, if I wasn’t going to stay put no less than that long, I would be really afraid of losing money on the transaction.  

Now, We know homes typically increase in value over time. But this can sometimes take many years regarding the value of a property to go up. Unfortunately, there are tons of costs associated with both the purchase of a house and the sale of one. Between transfer taxes plus real property agent fees for sellers, and title insurance, and mortgage origination fees, and a long list of other required expenditures, the process of buying and selling can cost tens of thousands of dollars.  

If I bought a property with the plan to move within a year or even so, our assumption would be that any property appreciation would likely not provide me along with enough to break even after paying all these fees, let alone make the profit. I actually don’t have any interest in having in order to take a big loss when selling a house, so I wouldn’t think about buying unless I knew that I would become there intended for long enough that will the gratitude on the particular property would likely cover these costs (and hopefully even net me the little profit).  

Holding a property for two many years or more would also come with the benefit associated with being able to reduce or avoid taxes if I do make a profit. You can exempt up to $500, 000 in profits from capital gains taxes as a married couple in case you meet certain requirements like owning the house for at least two years plus living within the house because a primary residence no less than two of the five years before the purchase.  

Basically didn’t live in the home for that two year period, then I can get hit with capital gains tax and lose a great chunk associated with any money I happened to make.  

Buying a house pertaining to the short term really doesn’t make sense

If you’re considering purchasing a house but don’t know where you want to live in two yrs, in most cases, a person really shouldn’t move forward. There are, of course, exceptions to every rule. And sometimes you could end up making a lot of money on a quick home selling. But, this isn’t going in order to happen in most situations, so you should generally stick to purchasing a property only if a person want in order to set down roots there for a while.  

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