Should you save to buy House or build up your 401K?

I just bought my first house in November last year, and was definitely suffering from the dilemma of should I save up to buy a home or put the money in my 401K. If you have the same situation I would suggest that there are a couple of different questions you have to ask yourself before you can get a clear answer. The first revolves around are you looking to move soon? I.e. do you like your employer or do you think you can move onto pastures new that may have better opportunities. Being tied down to a house can limit your moves to only local companies, unless you are willing to loose money in buying and selling a home quickly. Although if renting your house can easily pay the mortgage and expenses, which is usually applicable by your mortgage lending after living in the house for one year, then it actually may be a great way to build up your rental property empire!

Also, do you get a good match from the 401K? It’s essentially free money that you are passing up on if you decide not to take it. For me when I moved up in my career when working for me previous employer I lost the match however, but I did get 10% of my salary placed in a 401k that was not dependent on my savings rate. At this point I decided to specifically save up in my 401K as this was essentially tax-free savings, allowing me to save about a third more money each month. Then when I left my old work place to a better paying and more stable job, I was then able to loan myself the down payment for the house, at a very interest low rate, over 30 years, and where the interest payments go back to me rather than to a bank/mortgage company. The advantage here was that I could save up the down payment in only 2/3rds of the time, as well as tap into the significant performance of the stock market over the last couple of years, which has unsurprisingly now slowed down after the significant gains of the last few years.