Do Not Let The American Dream Become A Nightmare

Do Not Let The American Dream Become A Nightmare

Many people come to me and say, “This market is crazy! Should I be thinking about buying a home?” The answer is yes, you should always be thinking about buying a home, but the real question is ‘Are you ready?’ The sad fact of the matter is many people jumped into the market when they weren’t ready back in the mid-2000’s and unfortunately lost their house because of that. Here’s a few ways to tell if you are ready to live the American Dream.

Can you afford it?

That seems like an obvious question but the answer is not as obvious. Buying a house is not just about having that down payment ready. There are other various costs, such as inspections, closing costs, money for repairs after purchase, etc. You are fooling yourself if you think you can find a house with absolutely no repairs needed. Every house needs a little TLC and you have to be sure you can afford it. I take the Dave Ramsey approach and recommend having at least 6 months worth of living expenses above and beyond what you will need for down payment. Also a mortgage really ought to be the only debt on your plate outside of student loans and maybe an affordable car payment. Being conservative about your finances can keep you out of trouble. There are quite a few low down payment loan programs made to benefit home buyers in Denver, Aurora,  Littleton and  Centennial, among other places, but you still have to make sure you can take on the responsibility.

Can you handle the responsibility?

Houses are a lot of work! Yard maintenance, plumbing, electrical, etc.  If it wasn’t, Home Depot would probably be out of business. As a responsible home owner, you have to be ready to keep up with the necessary maintenance. You are your own landlord. If the furnace goes out, nobody is going to take care of that for free. I often recommend first time home buyers consider purchasing a condo or townhouse first to make sure they can handle it.

How long do you want to stay?

I know a few people who are nomads. They like moving every couple years and get bored where they are living. These people are probably not ready to buy a home. Of course, if the plan is to rent out the current home and then buy something else, that’s a different story. If somebody wants to sell their home a year after buying it, they may not make money that way. There are a number of costs associated with selling a home and if the equity/mortgage principal reduction does not offset those costs, you will have to bring a check to the closing table. The general rule tends to be 3-5 years before you get to the breakeven point. Of course, it’s all case by case.


Some people can get so caught up in the excitement and frenzy of purchasing a home that they don’t REALLY know if their significant other is on the same page as they are. I see it all too often where one person in a relationship is ready and the other isn’t. What’s said is when communication breaks down and it doesn’t become clear until they are under contract or even after they buy the home. Its best to sit down with your significant other and talk about the pros and cons of buying a home. Otherwise, it could seriously jeopardize the relationship.

Being a Realtor, I believe in Home Ownership. I see the joy in people’s faces as the sign the last document and it hits them that they own a home! On the flip side, I meet with people sometimes who just simply aren’t ready. I will be the first to tell them. My conscious won’t let me hold it in. If you think you might be ready but you need someone to discuss all these factors with, call me today!

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Matthew Koller is part of the Carr Peck & Associates at Keller Williams. Carr Peck & Associates have been recognized locally and nationally as experts in real estate. Locally, they are Realtor Roundtable Recipients with Denver Metro Association of Realtors. Nationally, they have been recognized by the Wall Street Journal and Real Trends as one of the top selling agents in America.  

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Phone: 720-446-6301
Dated: May 25th 2014
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