Five Good Reasons to Buy Right the First Time

By Shelley Wake

There's an unspoken rule out there in the real estate world that says first-home buyers should start with a small house and upgrade later when a bigger and better house is needed. Like many unspoken rules, this rule is worth questioning. For some, this plan to constantly upgrade may not be the best option.

Here are five good reasons to consider buying right the first time.

1. Save Money on Costs

Each time you move, there are going to be real estate fees, loan fees, inspection fees, bank valuation fees, and removal costs. These costs can total over $20,000.

2. Prices Will Only Go Up

The house you start with is going to increase in value...and so is the house you want later. Imagine both houses double in value in ten years. The first house that costs $100,000 now, will then be worth $200,000. The second house that costs $200,000 now, will then be worth $400,000. As house prices increase, the gap between the two houses will get larger. This means you might be better off in the long run if you buy the house you really want from the beginning.

3. Inflation Doesn't Make the House Payments Go Up

Inflation makes the prices of everything go up, including wages. The thing that inflation doesn't do is make the house payments go up. If the payments are $500 per week at the start of the loan, they will still be $500 per week at the end of the loan, give or take some changes in interest rates. The difference that will occur is that this $500 will be worth less. Take this into account when you are planning for the future. If you can make the payments in the early years, then the later years should only get easier.

4. Convenience

Selling a house, finding a new house, moving into a new house - these things are all difficult tasks. They become even more difficult if you are trying to complete them after major changes, such as having children. Starting out with a house fit for the future can make life a lot easier.

5. Making the Payments

Two months after Jacob got married he purchased a five-bedroom house with all the extras. Everyone he knew asked him why he needed all that just for himself and his wife. Jacob gave everyone the same answer: "If I'm going to be paying hundreds of dollars a week for 25 years, it better be for something I love." Jacob decided he'd rather add a hundred dollars a week to his mortgage payment, than save this amount and live in a house he wasn't happy with.

Think about these factors when you purchase. Consider what the payments will be for the house you really want and if you can afford it, consider doing it right the first time.