Why We Chose To Buy Our First Home With Cash

In the post, I will share the reasons why we chose to buy our first home with cash. Buying a first home is a significant milestone for most people.

For us, it was a dream in the making. Instead of using the traditional mortgage route, we purchased our first home with cash.

This decision was not impulsive; it was carefully considered with several key advantages.

Before taking the leap of faith to purchase our first house, we were skeptical about the whole process.

The sheer magnitude of financial commitment was daunting we questioned whether tying up a large amount of money to a house was a wise decision.

What made the decision hard was seeing everyone around us (family and friends) buying houses with mortgages and us making that unconventional decision of buying our first home with cash.

A path that no one we knew personally had taken. We questioned ourselves so many times.

We were lucky we managed to buy our house in 2022 just before the spike in interest rate and house prices.

Here are the reasons why we decided to buy our house using cash.

1. Freedom From Debt

The most obvious benefit is the freedom from a mortgage. No monthly payments, no interest accruing, and no risk of rising interest rates.

This significantly reduced our monthly expenses and provided a sense of financial security.

2. Increased Financial Flexibility

Without a mortgage, we have significantly more financial flexibility. Our income is not tied up in a large monthly payment, allowing us to save more.

3. Investing

We can put our extra funds towards higher-yielding investments, accelerating our savings growth.

4. Pursue Other Financial Goals

Whether it is early retirement, travel, starting a business or buying another house we have the freedom to pursue our dreams more readily.

4. Handle Unexpected Expenses

Life throws curveballs. Having a significant cash reserve provides a safety net for unexpected emergencies.

Read more tips on house buying here

5. Reduced Stress

Let’s be honest, a mortgage can be a source of stress. The constant worry about interest rates, the pressure to make timely payments, and the fear of potential foreclosure can weigh heavily.

Buying with cash eliminates this stress, allowing us to enjoy homeownership without financial anxieties.

6. Negotiating Power

Buying with cash gave us a significant advantage in negotiations. Sellers often prefer cash offers as they are generally faster and less likely to fall through due to financing issues.

This gave us an edge in a competitive market and potentially secure a better price or more favourable terms.

Of course, buying a home with cash isn’t for everyone. It requires significant discipline and long-term financial planning and often involves making significant lifestyle adjustments to save aggressively.

But for us, the freedom, flexibility, and peace of mind that come with cash homeownership made it the right choice.

Keep an eye out for more posts on our journey of buying a house with cash and our plans.