Having your own roof is everyone’s desire. Therefore, buying a house is one of the most important decisions of anyone who wants to give you the comfort and security that your family deserves. However, realizing this dream entails a series of commitments and a high economic expense. Pawel Kentaro Grendys, an expert in Latin American real estate, provides insight into knowing when to make the right decision.
Although the value of real estate is higher now, the answer varies depending on each individual and their economic situation. As well as possible scenarios: a job with higher income, working outside the country, having children in the short or medium term or losing your main source of income could affect your purchase decision.
However, one way to determine it, according to Grendys, is to analyze not only the general context of the economy, but, in particular, of your pocket and keep in mind probable situations. This will help you not to rush and know exactly when to buy a home.
“It depends on the person’s financial preparation. That is, stability, expectations, economic conditions, knowledge of the implications of their decision and the ‘benchmarking’ of entities to evaluate the one that fits their needs,” specifies Grendys.
In other words, if you have the financial conditions to buy a home or finance your apartment, do it now. But, taking into account the level of commitment that has to be assumed to obtain a mortgage loan.
Otherwise, meticulously organize your finances and define a long-term savings plan. That is, at least two or three years, so that you save a “good initial” and opt for a mortgage loan, if applicable. Therefore, also try to create a credit history and that it has positive results.
The real estate specialist also urges buying an apartment in payments. To do this, you must save for the reservation and separation in plan. Ideally, it should be a project that is not yet built, but that will be delivered within a minimum of 24 months.
After paying the reservation and separation, you must establish with the construction company the monthly contributions you can make. While you are paying, you must save to later establish the extraordinary contributions with the construction company. But do not forget that the contract possibly contemplates an increase in the initial amount, product of the increase in construction materials. Be clear before signing.
The first step to long-term stop paying rent is to make a thorough analysis of your financial situation and determine which expenses are unnecessary. There you might realize that you may be incurring “ant expenses” that are consuming between 15% or 20% of your monthly salary.
Another option is to apply the 50/30/20 rule. This formula indicates how to manage your monthly income: 50% for your fixed expenses; 30% for the other expenses of the month and 20% to save it, seeks that you can fulfill your commitments without putting pretexts to saving.
Adds Grendys, “Start a savings plan with an institution and invest. That is, that the money saved instead of being stored under your mattress is in a bank generating interest. You should only research among the savings account options offered by banks and choose the one that gives you the highest interest rate and charges you the least commissions.”
Likewise, there are investment plans that guarantee profits in a set period of time, but take into account the risks that accompany it. The ideal is not to invest all your savings, but a part.
If you decided to stop paying rent to start with a mortgage, another alternative, perhaps with an extra effort, is to consider moving to a place where the rent is cheaper. This, along with seeking to generate extra income, will allow you to allocate more money to saving and be closer to your goal: to have your own home.