I think I know what you’re thinking.
What the heck? Why does the blog of Imagine Interiors, a leading interior design company based in Bangladesh, feature an article on personal finance – how to know if you’re ready to buy your own home?
You see, the point is that – all these things that I talk about, whether it’s living room design or bedroom design – these are not just a matter of changing a few colours or placing a few cushions here and there. These are a way of gaining an intimate connection with your home. And the ultimate personal bond you can create with your home is the bond of home ownership. Now we come to the point you may have noticed earlier – I said, if your browser is working, you are ready to buy a home. As you can understand, that is not true.
However, many so-called ‘financial advisers’ out there will give you that kind of advice only – erroneous and ridiculous advice. That is why I want to give you a clear and unbiased idea of when you can consider yourself ready to buy your home.
So, when are you ready to buy your own home?
1. When you feel ready to settle down
Sometimes, people just feel good at moving around. They do not want to settle down at one place. This is particularly true of millennials.
However, with rents zooming up like crazy (according to the Consumer Association of Bangladesh, the average rent in Dhaka has shot by 350% from 1998 to 2018), sometimes it makes sense to buy your own home and settle down. For most people, the desire to keep moving also goes away at some point of their lives – and they decide to settle down and build a home.
2. When you need more room?
Rented accommodation tends to be less spacious than owned homes. In other words, if you rent, you may have to settle for fewer rooms or smaller rooms than you would like.
Now, if you’re thinking of having children, just having more space is certainly necessary. (Please remember that having children means your monthly expenses will increase; so make sure you can pay your EMI’s on time even if your expenses increase.)
However, in other cases, I would say, you should only go for ownership when you feel you really want a place of your own, a place you will personalize and leave your imprint on.
3. When you have sufficient monthly income
It’s very likely that you will need to avail of a loan to buy a home. In order to be able to repay the loan while maintaining your monthly expenses, you need a steady source of income, which can only come from a job.
Different institutions will have different requirements about your job and salary; I am only giving you an idea of how these issues should be tackled.
The point is that you should have an assured income source so you can repay your loan without worries.
If you’re self-employed, look at your average monthly earnings over the last 2 years and see whether you can safely afford to keep repaying your loan even if your monthly earnings drop by 10% of the average value.
4. When you are aware of all financial payments you will have to make
If you’re renting, your landlord is responsible for repairs and maintenance. However, if you own your own home, you alone are responsible for repairs and maintenance. Moreover, a lot of the time, there are additional expenses you’ll have to meet if you buy your own home.
For example, many apartment complexes have homeowners’ associations which assume responsibility for maintaining the common areas of the complex. In that case, you may have to pay a monthly fee to them for those services.
5. When you’re certain you’re getting a good deal
This may be a bit difficult for some people to act upon, but you should know this. Like everything else, the housing market has its ups and downs. Sometimes property prices are exorbitant and sometimes they crash. You can understand, if housing prices have crashed, you’ll get a really good deal if you buy a home.
If you want to capitalize on that, go ahead and start planning your purchase!
To sum up,
Interior design is about personalizing your home. And the ultimate personalization happens when you buy your own home. However, buying your own home is a major financial decision. And Imagine Interiors, being a responsible and ethical organization of Bangladesh, wants you to know all the factors you need to examine before making a decision to buy.
When should you buy?
- When you feel ready to settle down
- When you feel it is time to have a ‘castle’ of your own
- When you have sufficient monthly income
- When you are aware of all the payments that will become your responsibility as a home owner
- When you think you’re getting a good deal on the property price
The main thing is – buying your own home comes with its share of responsibilities.
When you are ready to meet those responsibilities and when you are ready to have a ‘place of your own’ – that’s when you should buy your own home.