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Ask Stacy: Am I too old to buy a house?

A reader is thinking of buying a home, but wonders if she's a little long in the tooth to start the process.

By MSN Money Partner Mar 25, 2014 12:10PM

This post comes from Stacy Johnson at partner site Money Talks News.

Money Talks News on MSN MoneyLike it or not, there are certain things in life that have an age limit. Joining the army, playing professional football and being a runway model, for example. But what about buying a house?

Toy house sitting on money © Vstock, Tetra Images, CorbisHere's this week’s reader question:

Should I purchase a home if I am over 45 years old? I have never owned a home and I'm thinking of purchasing a home as a first-time homebuyer. I think I might have waited too long. Please advise. -- Patricia

The short answer to your question, Patricia, is no: You're not too old to buy a home. I'm 58, and bought one for investment a couple of years ago. I'm also thinking about buying another one to live in, although I'm not sure I’ll do that anytime soon.

Homes are expensive and can be complicated to finance and difficult to keep up. But at the end of the day, they're just another purchase, like a car, washing machine or anything else. Which raises the question: Why are you concerned you're too old to own one?

I suspect it's because you've never been down this road before and are afraid it may be too much to handle, especially as you approach your retirement years. Or perhaps because you're afraid of having a mortgage during retirement.

Owning can be awesome

I bought my first house at age 21, and with the exception of a few months in transition, have owned at least one ever since. Why? Let me count the ways.

1. It's often cheaper than rent. I haven't made a fortune owning homes, but I've certainly never sold one for less than I paid for it. Granted, after all the time, effort and money I've invested in fixing up my various homes, my returns may be less than stellar. But since I have to pay to live somewhere, I might as well use my housing money to build equity for myself rather than my landlord.

There are places where I couldn't afford to own a home -- Manhattan comes to mind -- but if I can afford it, I'll always buy. Even when I'm 90. After all, it's the only investment you can live in, and after you shuffle off this mortal coil, those you leave behind can use it as well.

Check out our recent story, "Owning a home is cheaper than renting in many cities."

2. You call the shots. You only live once, so you might as well do it in a place you enjoy. Want a skylight or a hot tub? Put them in. Want to paint your kitchen red or add wood flooring in your bedroom? Other than your budget, there's nothing stopping you.

3. It offers financial security. While nothing is certain other than death and taxes, something else comes pretty close: rising rents. When you own your home outright, there's no more monthly expense. Even if you have a mortgage, as long as the rate is fixed, your payment will never rise.

4. There's something for everyone. When I was younger, I was all about "sweat equity," meaning increasing my home's value by fixing it up myself. While I still swing the occasional hammer, these days I'm less inclined to do the work personally.

But that's OK, because there are housing options that require less work than a single-family home. I could own a townhouse, which could alleviate a lot of yardwork. I could own a condo, which requires less work of all kinds. I could buy something newer that doesn't require as much maintenance.

Owning has drawbacks

Of course, there are two sides to every debate. Here's a look at some potentially bad things about owning.

1. It's not cheap. There's no question that owning -- at least in some cases -- costs more than renting. Houses break, and when you're an owner, you'll be either doing the work yourself or paying someone else to do it -- probably both.

Also, while you can eliminate or at least maintain your monthly mortgage expense, you can't control rising insurance, property taxes and other costs.

2. It ties you down. Because of the transaction costs of buying and selling homes, you shouldn't even think about owning if you're not staying put a minimum of five years.

3. It could go down in value. That's not something I would have said prior to 2007, but, as millions of Americans have now experienced, owning something that's worth less than you owe on it is an unpleasant experience.

4. You could have a mortgage in your retirement years. Depending on the type of loan and when she retires, Patricia could be faced with a mortgage at a time when it's best to keep debt to a minimum. Of course, if she doesn't buy, she'll face rent during retirement.

But it would still be best, if possible, to minimize the ongoing expense of a mortgage by paying it off while still working. This she may be able to do by taking out a 15-year loan, or taking out a 30-year loan and making extra payments on the principal.

5. It requires some education. Shopping for both a home and mortgage can be daunting. There's a lot to know, from avoiding a money pit to negotiating for the best financing.

Since lots of people do it, it's obviously not rocket science, but it's a lot more time-consuming than finding an apartment and signing a lease. Personally, I kind of enjoy the process, but I can certainly understand those who don't.

It's time for some soul-searching

Patricia started this by asking if she's too old to be a first-time homebuyer. Definitely not. But there's a reason she has hesitated to buy a house, and now’s the time to find out why.

Patricia, take out a sheet of paper, make two columns, and start listing your personal pluses and minuses. I can tell you that you're not too old, you'll probably find satisfaction in owning a home, and there's nothing about the process you can't learn.

But this isn't a question with an answer that's correct for everyone. Do some thinking, talk to some friends on both sides, then make a decision. And remember that whatever you decide, you can always change your mind. Like I said earlier, while buying a house may be a relatively complex transaction, at the end of the day it's just another purchase.

More on Money Talks News:

Mar 25, 2014 1:28PM

I say you are never too old for anything you want to do.

Mar 25, 2014 1:35PM

first thing I did in life was buy and pay for my house...I'm 52 now and have owned for over 10 years!

Once the house was paid it was on EASY STREET!   I have even lost jobs and I was fine!

don't listen to people who tell you not to pay off a house!  If I would have listened...I probably would have lost my house during 50 on my friends~


I can now do what I like with my money!!!!

Mar 25, 2014 5:23PM

If you can afford it go for it!

My 70 year old friend spend her life being a hostage of landlords.  Lo & behold, with this crappy economy the property values being low she was able to buy a duplex in a retirement community for $26,000.00. Originally the duplex used to be sold for $90,000.00.  Was for sale over 3 years and the only thing that needed was painting and cleaning.

Her happiness in having her own roof, plenty of room for her, 2 cats, guests and her own garage, no less.  We helped her paint and it is her heaven.

Mar 25, 2014 1:24PM
most people can't retire if they still owe on their house, and should plan on having it paid off by then.
Mar 25, 2014 3:53PM
Got a buddy that bought his first house @ 50 years old. The only regret he has is he did not do it sooner.
Mar 25, 2014 6:14PM
My Wife and I purchased a home last year at age 85 for me and 83 for  her. The best part is we 
got a 30 year mortgage Is this a great country or what?. 
Mar 25, 2014 3:07PM
Federal Mortgage Lending Law

Equal Credit Opportunity Act

The Equal Credit Opportunity Act prohibits discrimination in lending based on race, marriage status, national origin, age or receipt of public assistance money, such as supplemental Social Security.

Good to know, you are never too OLD to get a mortgage loan.

Mar 26, 2014 12:17AM

I paid off my home in 2003 and am in the construction trades so home maintenance is rarely a problem. As I look around at local rents for 1-2 BR apartments I find it financially comforting that my property and school taxes are less than 2 months rent. Heck, I even have enough backyard space for some strawberries, blueberries, melons and tomatoes.

Unless you suffer from wanderlust and constantly want to job hop, home ownership for me beats renting. .

Mar 25, 2014 6:32PM
You also need to figure out if you can handle the maintenance of owning a home.  I never realized how much work owning would be.  Yard work itself can take up a lot of time, then there are things like maintaining gutters etc.  If you can do maintenance and repairs on your own then that is one thing, but hiring all those things out can really hit your finances.  
Mar 25, 2014 4:14PM
Low interest rates, a glut of houses on the market, buying a house is a no brainer.  The future of renting has no up-side, unless you plan on moving allot.  While rents will always increase, with the exception of taxes and insurance, your housing cost will stay the same.  Renting is lost money.  A house purchase provides some protection for your income with the deductions you get at tax time.  Plus there is always the equity you are building.   5 years after you buy a home and realize how much rents have gone up, you really understand the advantages.  The deductions at tax time more than offset the maintenance cost.  You can be living in your own home for less monthly cost than renting something not as nice with all the rules that come with renting.
Mar 25, 2014 6:55PM
As an elderly person, though, I probably would not want a two or three story dwelling with stairs.
Mar 25, 2014 7:51PM

Sounds like a personal decision with no correct way to go, as long as the math works for you.

Mar 25, 2014 5:07PM
I am 55 and just bought my townhome.  I am so happy with it, it's like paradise compared to the crappy apartments I was renting for about the same price!  I found rents going up and up every year.  I am going to try to pay it off before I retire (if I ever get to) but even if I am a little short, maybe I could get a reverse mortgage.
Mar 25, 2014 5:53PM
No worries. Bought the house I live in a few years ago at 49, my age actually never occurred to me. I'll have the mortgage paid off way short of 30 years. I've learned with other loans that you just have to focus on that as a priority, and it happens. Oh, and it comforts me that it has gone up in value since I bought it, though it doesn't matter much since I'm here to stay.
Mar 25, 2014 6:42PM
I bought my house last year at age 60.  It's a two family.  I live in one apartment and can rent out the other.  It's a source of income and greatly helps with the mortgage.  I think inflation is in our future....and rents somewhat keep pace with inflation.  My only regret was I didn't wait longer and buy a 3-family in the same neighborhood....but I'm still in good shape.
Mar 26, 2014 12:03AM
Just do the math and pick what gives you the best bang for the buck, retired or not.  
Mar 25, 2014 5:31PM
I'm 50 and just purchased a home.  I have a life insurance policy that will pay it off and a will that leaves it to my children.  Wills and plans for children should be handled anyway if you have minor children ect. 

If it's not an investment, think about how you will pay for it after you retire.  Ive never considered myself attached to walls and dirt, so I may or may not sell it down the road.  For now, it's a great home and much much less than I would be paying for rent. 

Mar 25, 2014 5:34PM

Stacy Johnson, stated that owning a home, can be awesome. Yes, but it could be a burden, if retired.

Ms Johnson, did not ask the important questions, about Patricia's finances, debt, and expectations. Upon retiring, is she planning to have the home paid off, and  her debt paid down, when Patricia retires, or what? I think age, is a very big factor, in that decision, unless your planning to work, till you drop.

Mar 26, 2014 12:45PM
I have a friend who purchased one at 57.  It's a townhouse and her mortgage and insurance are under 500.  It was a good move for her because rent in that area is more than a 1000.  Even in her retirement years she'll still pay 500 and the rent would be--who knows.  
Mar 25, 2014 7:44PM

     I am old (48) and reitired and spend my time acquiring investment real estate and say that it is a total different world when you have skills to repair them yourself as it actually saves $1000s. Never stretch finances to point that payments depends on renters' payment  to be on time.

 If able -the section 8 renters program usually pays about 1/3 more than the areas going rate but requires house to be kept up to a code (no matter if renter broke it or not) and DIY  repairs keep handyman bills lower.

With the amount of "underwater"people still in the market a little hussle and research can score a deal savving tens of thousands . Sometimes people just want out and it works for everyone

   Most of all TRUST YOURSELF if it doesn't feel right and you are talking youself into it ---My experience is just walk on to the next and save the hassle,headache and expense!


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