Want to know if you should buy a home or condo in this Madison Real Estate market
We are inspired by NBC going green last week, so The Gardyn will go green this week. We might recycle some posts and all our font will be green.
Recycled Post from Is now a good time to buy real estate?
That depends. That question would be equivalent to walking into a doctor’s office and asking “Is now a good time to have a surgery?” The doctor would want to know if you are sick, injured, or ill. She would want to do tests, exams, and scans. She would not do a surgery if you are healthy. Your health and body are unique to you. So is your position for buying real estate. Like the doctor, I would have lots of questions. I would do a needs analysis with you. I would refer you to talk with a mortgage lender. I would find out about your situation. The truth is, now is a great time to buy for some people and an awful time to buy for some people.
Suze Orman, famous financial expert author 
and talk show host, gives a great exercise in her book, Suze Orman – For the Young, Fabulous & Broke
Given all the extra costs of owning, you need to be plenty sure you can handle the bills before you take the housing plunge. Put yourself through my six month “play house” test.
- Figure out the cost of homes. Use a mortgage calculator to estimate your basic mortgage costs.
- Add 40% to that sum. That is your home ownership cost.
- Subtract your current monthly rent from your home ownership cost.
- Set up a new bank account and deposit that difference in the account on the first day of every month for six months.
If you pay $1000 in rent but your home ownership cost (including all the extras, taxes, maintenance, etc.) is $1,271, you need to deposit $271 a month into your test account. If you miss one payment, or if you are consistently late in making the payments, you are not ready to buy a home. If you can handle the extra payments, then you’ve got the thumbs-up to start looking for a home to buy. By the way, in playing house, you’ve also beefed up your down-payment fund. In the previous example, you would have saved up $1,626. in six months.
By the way Madison real estate buyers,
- interest rates are still low-that means low montly payments
- housing inventory is up-that means more selection and choices
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4 Comments
November 18, 2007 at 5:00 am
[...] Why is a Good Time to Buy? [...]
November 21, 2007 at 10:28 am
It is also a great time to sell your home in Madison and buy one in St. Paul.
December 1, 2007 at 10:26 am
Thanks for the Green info and the general article on buying a home. Can you provide any information on buying a home in Madison now? For instance, what has the market done in the last 3Y, 1Y, recently?What are the issues and trends in Madison now? Etc. Thanks!
February 4, 2008 at 11:59 pm
I did a short post in my blog about why this is a great time to buy a home!http://www.homebuyingmortgage.com/2008/01/why-is-this-great-time-to-buy-home.html
I focus on Wisconsin home buying and decided to start a blog to write about the mortgage experience I’ve gained over the years.