If you’re like most people, buying a home is the single most expensive purchase you’ll ever make. And, when you buy your first home, the costs can feel even more significant since you don’t have an existing home to sell to help fund your new purchase.

According to the National Association of Realtors, the typical first-time homebuyer is 36 years old. While 36 might be the average age people buy their first home, everyone’s situation is unique, and you should only buy your first home when you’re financially and mentally prepared to take on the responsibility.

Here are 6 signs you’re ready to buy a house:

1. You have a consistent income

Each month, the bill for your mortgage arrives without fail. To ensure you can continue making your regular payments, you need to have a regular income (most lenders will look for that, too). A consistent income doesn’t necessarily mean you have to be a high earner. If you’re not sure how much you can spend relative to your income, you can always refer to the 28/36 rule, which advises spending no more than 28% of your pre-tax income on your mortgage, and no more than 36% of your income on total combined debt.

2. You’ve built up a solid emergency savings fund

Even if you have a stable, secure income, you’ll want a sizable emergency savings fund before you buy your first home. If you’re injured and temporarily unable to work or experience an unexpected layoff or any other financial challenge, an emergency fund can help you keep up with your monthly bills. Emergency funds can also be useful for home maintenance, repairs, or paying your insurance deductible, but most importantly, they help you avoid making a poor financial decision like taking on high-interest debt to cover an emergency expense.

3. You know where you want to live for the next several years

You can always make changes to the home itself, so if you want to renovate, paint, or build an addition, the possibilities are endless (though they may cost you a pretty penny). You can’t, however, move the actual property to a new location.

Real estate isn’t considered a liquid asset, so if you decide you want to cash out and move elsewhere, it may be possible, but it will cost you time and money.

No one knows what the future holds, but before you buy a home, you’ll want to commit to staying in the home for at least 3-5 years. If you plan on owning the home for fewer than 3 years, renting will likely be the smarter financial decision, though the choice is ultimately up to you.

4. You have excellent credit and minimal debt

If you’re taking out a loan, your lender will run a credit check and evaluate your creditworthiness as a borrower by examining your debt-to-income ratio. Lenders offer the best rates to borrowers with high credit scores and lower debt-to-income ratios, so if you need to postpone your home purchase to pay off debt and work on increasing your credit score, it might be a worthwhile investment in the long run.

5. You have the cash saved up for a down payment

Besides finding an affordable house that matches their criteria, buyers report saving up for a down payment is one of the main obstacles to home ownership.

Though there are loan programs where you can finance 96.5% – 100% of the purchase price, a small down payment comes with drawbacks, including higher monthly payments and additional fees for mortgage insurance.

In addition to the down payment itself, many first-time buyers are unaware of how high closing costs can get. These costs vary based on the location of the home, the lender, and other factors, and can range from 2-6% of the purchase price. For a first-time buyer putting 10% down on a $300,000 house, that could mean having to save $48,000.

6. You’re mentally prepared and excited to own your home

You might know where you want to live and have the finances to buy your dream home, but none of that matters if you’re not mentally prepared to take on homeownership. Buying a home is something that happens on your timeline, and when it does, you should be excited about making that house into your home.

FAQs

Where can I find a real estate agent?

Finding the right real estate agent for you can be a challenge, which is why referrals from family and friends are often the best way to go. You’ll be working closely with your agent and you want to make sure you’re a good match, so feel free to interview different agents and ask them questions about how their style of doing business. You can also look online for reviews, but in my opinion, trusting your instinct is the key to success.

How do I get a mortgage?

To get a mortgage, you’ll submit a completed mortgage application to a lender. In most cases, obtaining a mortgage pre-approval is the first step in the process. During this process, the lender will ask you about your financial situation and your employment history. You’ll have to share some personal information, including recent pay stubs, tax returns, and more, which helps the lender evaluate how much money you can borrow. There are thousands of lenders across the U.S., and, as with real estate agents, you can speak to different lenders before settling on the one you want to work with.

How can I negotiate on a home price?

Your real estate agent can help you negotiate on a home price, but if you prefer to do it yourself or you aren’t working with an agent, one of the best ways to negotiate is by asking the seller what’s most important to them. In some cases, sellers may be willing to negotiate in exchange for a quick closing, a rent back, or fewer contingencies attached to the contract.

When is the best time to buy a house?

The best time to buy a house is when you’re personally and financially prepared. No one can predict the future of the housing market or interest rates, so try and focus on how much house you can afford, and don’t worry about timing the market.