If you’re planning to buy a home in the near future, you probably assumed you’d take out a mortgage, right?
But did you know that more and more homes are being purchased without a mortgage? In 2017, one-third of all homes were purchased without a mortgage!
If you’re wondering how you can pull that off or how to buy a house with cash only, you’re in the right place. Keep reading to learn how you can have the American dream of owning a home without going into debt.
How to Buy a House with Cash Only: Is It Really Possible?
The short answer: yes, you can absolutely buy a house with cash only. However, it’s going to take some work (and maybe some sacrifices) on your part. Strategies for buying a house without Cash include:
Live With Your Parents and Save
If you’re young and just starting out on your housing journey, consider living with your parents and saving as much as you can. If you live at home during college or work full-time while still living at home, you might find that you’ve socked away enough cash in your mid- to late-twenties to pay cash for your first home.
Not only can you save on living expenses, but you can also save in other areas. Give yourself a strict entertainment budget, try to limit eating out and take-out, and make coffee at home. Remember when we said you might have to make some sacrifices?
Find Cheaper Housing
If you really want to avoid a mortgage, you might have to consider a less expensive home (such as a mobile home, tiny house, or even a townhome or condo). A foreclosure or fixer-upper is another great option for you, particularly if you’re handy or have family willing to donate their sweat equity to fix up your new home.
Or, you can opt for an area with a lower cost of living. Maybe you don’t live in a trendy part of the city or in the fanciest suburb, but think of how good that financial freedom will feel!
Downsize From Your Current Home
If you currently own a home that seems too big for you (or if your mortgage seems overwhelming), consider downsizing. Depending on your home’s equity, you might make enough on the sale of your larger, pricier home to pay cash for something smaller and cheaper.
Work Your Way Up
Maybe you don’t have enough cash to swing your first (or even second) home purchase with cash. That doesn’t mean you have to abandon that dream. Instead, you can work your way up.
Few people stay in the same home for life these days, so as you buy and sell your homes, continue saving and eventually, you might just be able to make that all-cash purchase one day.
Even if you don’t have enough cash for a home purchase, there are other options besides a mortgage. Check out more about owner financing, which is one option.
Start Hoarding Those Dolla’ Dolla’ Bills!
Feeling confident that you know how to buy a house with cash only? If so, it’s never too early (or too late) to start saving that dough. Get your finances in order and relish the feeling of being debt-free.
For more tips and tricks on saving and investing, check out some of our other blog posts.