Leave a Message

By providing Space Intown, REALTORS® your contact information, you acknowledge and agree to our Privacy Policy and consent to receiving marketing communications, including through automated calls, texts, and emails, some of which may use artificial or prerecorded voices. This consent isn’t necessary for purchasing any products or services and you may opt out at any time. To opt out from texts, you can reply, ‘stop’ at any time. To opt out from emails, you can click on the unsubscribe link in the emails. Message and data rates may apply.

Thank you for your message. We will be in touch with you shortly.

A white kitchen with a stove and a sink. The kitchen has stainless steel appliances and granite countertops.

Here's Why You Shouldn’t Max out Your Budget when Buying a Home

Real Estate 101 Space Intown, REALTORS® July 11, 2023

When it comes to purchasing a home, it's easy to get caught up in the excitement of finding your dream property. However, it's important to consider the potential drawbacks of maxing out your budget for this significant investment. By buying a home that is within your means, you can maintain financial stability and preserve the ability to pursue other important financial goals.

In this blog, we will explore several compelling reasons why stretching your budget to its limit when buying a home may not be the wisest choice. After all, homeownership isn't cheap, and the expenses that come with it don’t just end at the closing table.

Maybe you love to travel but still want to settle roots in one location. Or you want to start saving as early as now for your retirement. Or maybe you just want to guarantee you'll have enough funds in case of emergencies. Buying less house than you can afford means you’ll still be able to free up money in your budget which you can use for your other goals: savings, travel and leisure, emergency fund, college fund if you have kids, and even retirement fund. You don’t want to give up these objectives just to pay a large mortgage payment, ensuring that you have the freedom and flexibility to live your life as you’d like.

If you borrow the maximum amount you can afford, you might find it harder to stay current on your mortgage payments in case your life situation changes. Just think of any of these worst-case scenarios that can happen after you sign the dotted line: you lose your job, take a pay cut, your car breaks down, or you or anyone in your family have had a medical emergency.

Depleting your savings just so you can buy a bigger home puts you at a greater financial risk in case such things happen. You can lessen this risk by keeping your monthly mortgage payments affordable and ensuring you have an emergency fund that won't leave you financially vulnerable.

While your potential mortgage payments are more fixed than rent and you think you can afford it, remember to give yourself as much wiggle room for rising costs. Higher grocery bills and energy costs, especially if you're moving to a bigger home, can make it harder to figure out a budget that you can comfortably afford each month. Likewise, homeowners association fees and property taxes also go up every year. While no one can plan for inflation, try to leave enough room when you’re putting together a post-home buying budget.

Perhaps one of the things you're looking forward to the most when it comes to having your own place is decorating it to your style and liking. And since most homes don’t have furniture and appliances, you’ll most likely need to buy these big-ticket items, which could dent your wallet. Even things such as rugs, blinds, and other necessary fixtures aren’t cheap. Purchasing a house within your budget will help you afford pieces of quality furniture and decor that will complement your space, as well as durable appliances that will last.

Finding the perfect property is a dream come true until you realize you aren't truly prepared for situations like leaky pipes, pest infestation, tree removal, or even gutter cleanings. If you’ve been renting for a long time before buying your first home, know that you can no longer count on your landlord to come over and fix things.

Maintaining and improving a home isn’t cheap, nor will it be easy. This is why it’s critical to limit your spending during your home search so you can have extra funds available for any maintenance and repair. It’s safer as well to have a cash cushion for renovation projects after move-in day so you can improve your home to your specifications and enjoy your space comfortably.

Being house poor means you're spending most of your total income on homeownership expenses, including mortgage payments, property taxes, maintenance and repair costs, utilities, and insurance, among others. If you’re living paycheck to paycheck and are having a hard time making ends meet because your mortgage is too expensive, the bliss and excitement of living in your dream home could be short-lived. You will soon find yourself stressed out just thinking about your house-related bills, and having little cash for the occasional splurge or a well-deserved vacation.

Recent Blog Posts

Exciting Developments Unfold at Midtown Atlanta’s Piedmont Park

Piedmont Park, Atlanta’s most cherished greenspace, is set to undergo significant enhancements, promising a brighter and more accessible future.

Why a Condo Could Be Your Perfect First Home

If you’re looking to break into homeownership but the price of single-family homes has you second-guessing, you might want to consider a condominium (condo) or townhom… Read more

Major Bike Lane Expansion Set for Midtown Atlanta

In an exciting development for cyclists and pedestrians, a major street overhaul is on the horizon for a busy section of Midtown Atlanta.

Mortgage Rates Drop to Lowest Level in over a Year and a Half

Understanding Home Inspections: A Guide for First-Time Home Buyers

Dive in and explore the different types of home inspections that will help ensure your new home is everything you dream it to be.

Celebrating Excellence: Space Intown REALTORS® Earns Top Producer Honors in Atlanta

Space Intown REALTORS® Achieves Top Producer Accolade in Atlanta Real Estate

Introducing Atlanta's E-Bike Rebate Program: Boosting Sustainable Urban Mobility

In a significant move towards enhancing urban mobility, the Atlanta Regional Commission, in collaboration with the City of Atlanta and Propel ATL, is gearing up to lau… Read more

Why Millennials are Choosing Atlanta: A New Trend Unveiled

In the ever-evolving tapestry of American migration, a captivating trend has emerged, painting Georgia, and particularly the vibrant metro Atlanta area, as a burgeonin… Read more

3124 E Pine Valley Road: A Historic Buckhead Estate

Nestled in the heart of Buckhead, Atlanta, the stunning estate at 3124 E Pine Valley Road represents a blend of opulence, history, and architectural finesse.

View All

Work With Us

Do you have inquiries about the real estate process? Need expert advice on a property? Interested in exploring investment opportunities? Our team is here to provide the answers you seek. Contact us today; we'll be delighted to assist you and offer expert guidance, helping you navigate Atlanta's real estate landscape with confidence.