The Five Worst Reasons to Buy a House

Thanks to a tight market, sky-high prices, and elevated interest rates, the path to home ownership is more littered with obstacles than ever, but buying property remains a key goal for most Americans—nearly 70% of us still consider it part of the American Dream.

But as much as you might think you want it, it's important to weigh all the financial and emotional factors that go into buying a huge. While it sounds impossible, considering the size of the commitment, it's surprisingly easy to get so focused on the anxiety of never being able to find the right house that you buy the wrong house for the wrong reasons. If you don’t want to wind up with a money pit or a house that simply doesn’t serve your needs (or your budget), it’s essential to take a step back from the brink and really examine your reasons for buying a particular property. If it’s one of the five listed below, you should reconsider.

The view

Some homes offer spectacular views—of nature, of a city skyline, or maybe the ocean. But buying a home for the view it offers is generally a bad idea, for several reasons:

• Cost. Homes that offer attractive views almost always come at a premium, meaning you’ll spend more for the same amount of house you could buy in the same area without the spectacular view. And some views come with even more additional costs, like a house with an ocean view that comes with a flood insurance premium.

• Impermanence. While some views are unlikely to change, you often can’t guarantee that someone won’t build something to obstruct your view in the future, or that other changes to the environment around your house won’t conspire to ruin your view.

• Imperfections. Amazing views can be distracting—if you focus too much on the incredible skyline, you might overlook other problems with the home or things that aren’t going to work with your lifestyle just so you have a nice view while sipping coffee in the morning.

Because “it’s time”

It’s easy to compare yourself to other people around your age, and if those folks are all buying houses, you might feel pressure to catch up. Or maybe you suddenly realize you’re the only person in your group of friends who’s still renting. Or just you’ve more or less arbitrarily made home ownership a box to check on your list of accomplishments.

But buying a house before you’re financially and emotionally ready for it can be a disaster. Buying a house isn’t just about coming up with a down payment and calculating a monthly mortgage—there are a lot of financial factors you need to consider, including whether you’re ready to make hard choices if find yourself facing an unexpected repair bill. You’ll also need to think about your readiness to tackle the truly endless home maintenance tasks a home requires—or to pay someone else to do them for you.

To save on rent

It used to be a golden rule: Paying a mortgage is cheaper than renting—or, if it’s about the same cost, at least you’re not throwing money into a hole every month, but building equity in an investment. The equity part is true enough—your mortgage buys you more and more direct ownership of your property, while rent merely buys you one more month living in that space.

But thanks to elevated prices and higher interest rates, the cost part isn’t true anymore, generally speaking: While you might find a specific house in a specific area that’s cheaper to buy than the local rents (particular if it's in a larger city with a hot rental market), nationwide averages show that renting is cheaper than home ownership, and will probably stay that way for the immediate future. Plus, there are those pesky insurance and maintenance costs, as well. If you’re buying a house because you think it will save you money, forget it.

You're betting on the neighborhood to improve

Homes in neighborhoods with a lack of services, high crime rates, or lots of unmaintained houses are generally cheaper, and if you have reason to believe that robust improvements are coming to the area, it can be tempting to buy low and then celebrate as your property values rise and rise. The problem with this plan, of course, is that nothing is guaranteed: Whether it’s business investment, a government-sponsored redevelopment plan, or you think you see the signs of simple gentrification, any number of factors—canceled contracts, local elections, stalled construction projects, a faltering economy—can change the course of events and leave you holding the bag.

Relying on a neighborhood turnaround also comes with plenty of other downsides:

• Time. Until your hoped-for revitalization comes to pass, you’ll be living in a crappy area and dealing with all the associated downsides, which might include higher crime, nastier neighbors, and worse schools.

• Taxes. If your property values go up, so do your taxes (eventually).

• Fewer options. If your life takes a turn you might have trouble selling that house or finding reliable renters due to its location. And if it’s cheap to buy, your equity in it will be relatively low until things pick up (if they pick up), meaning you’ll have limited resources for improvements and repairs.

It’s a fixer-upper

If you’re buying a house because it’s a “fixer-upper” at a bargain price, think twice. If you have experience in home renovation and construction and you have a solid plan for renovating the place, that’s one thing. But if you’re buying a run-down place with a vague idea that you’ll fix it up over time, there are a lot of reasons to hesitate:

• The unknowns. You really have no idea how bad that house is, why it’s been priced so attractively, and how much it will really cost to fix up until you get in there and start opening walls and floors. Your budget? Fiction until you actually see the wiring, plumbing, foundation, and other essential aspects of the house.

• Living in a construction zone. Whole-house renovations can take as long as a year to complete, and that’s if you’re working nonstop and don’t encounter any soul-chilling problems once you dig into the property. If you’re going to do it piecemeal, the renovation could stretch on for years, and you’ll be dealing with dust in your cereal bowl and splinters everywhere during the entire experience.

• Price uncertainty. You can buy a cheap house and put quality work into it, but that doesn’t mean the market will cooperate and raise your home’s value enough for you to get the return on that investment you’re hoping for. Keep in mind that the money you spend fixing up a house is part of the total cost of ownership; if you buy a bargain for $200,000 and spend $100,000 fixing it, you really spent $300,000 on that house—not counting mortgage interest, insurance premiums, and other incidental costs. Adding it all up can transform a bargain into a non-bargain pretty fast.

Only you can decide if buying a house is the right move—but if your reasons appear anywhere above, you owe it toy ourself to think again.

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