Can you make any money on your home?

You can make money on a home purchase if you do it right. Even in this mortgage melt down market, it is possible. Their is probably not very many people talking about it. I think you still can get it done.

I am going to give a example of this. I am going to use the current market as an example of this. First we need to get all the information as far as the cost of purchasing a home. We want to get all the information for this.

Now most loans are FHA loans or federal housing association type loans. So I am going to use this as an example. I am all so going to use nice round numbers.

We are going to talk about the down payment. Right now lenders are requiring a down payment of three percent. i am going to give a example of a one hundred thousand dollar house. So we are going to need a down payment of three thousand dollars.

You will probably need to bring some money for the closing cost. Lets say on average 2500 dollars to help with the closing cost on a $100,000 dollar house. So we have a total of about $5,500 dollars into the house.

Most people would say that we are down $5,500 dollars but this would not be actually correct. The Us government is giving a $8000 dollar credit to buy a house this year.

So our total now is going to be $3000. What about the property payment? we are still going to have a mortgage payment of eight hundred fifty dollars. but you have a rent payment to. So no matter what we are going to have a payment.

We all ways want to think of these home purchase in the long term. we need to look at this for at least 10 years. So were are we going to be at with our $3000 in ten years?

Since we are looking at this house purchase as long term We should expect the home property to be double the price we bought the home for. So we can add that to the $3000 we had all ready should be up.

Now we don’t know what the future will bring but we can use averages. So after the ten years we should be at about one hundred three thousand dollars in the ten years. That is a lot of money. How many investments can make a return like this? remember from day 1 we were up $3000.

How do you know if its a great time to buy a home? When you have a great job? When your credit score is really high? When you have a family? Do you really want the new responsibility of owning a home?

How about yard work? Be prepared to have at least a small lawn to maintain, unless you move into a condo where you don’t have to maintain any yard or amenities, or move into the city where the only grass you see is a tiny bit creeping up from the cracks between the concrete, no wait, that’s a weed! I’m getting off track here, sorry.

Their will be a lot of items to think about when buying a house. Besides how you will come up with the money for the down payment. Now the lenders do require some sort of down payment. You will all so need to figure out what you going to be able to pay for a monthly mortgage payment. But as you can see their are a few things to figure out before you buy.

A rule of thumb is that it rarely makes sense to buy if you expect to move within two years. That’s because when you do sell, there are costs associated with selling. We’re not just talking about sales commissions to the buying and selling real estate brokers.

When you sell your property, most people hope their home has increased in value. the increase in value hopefully would cover the cost associated with buying and selling a property. A lot of it will depend on the current condition of the housing market.

However, most buyers live in their new home an average of seven years or more. If that fits you, it almost always makes sense to buy rather than rent, in practically any market.

Why? First, if you are thinking about delaying a purchase because you want to “time the market” to get the very best deal, that is almost impossible to do with precision. Even if you are in an area with declining market prices, the most knowledgeable experts cannot reliably anticipate the “bottom” of a real estate market.

You can always say that the market will come back after a decline. This is true, but you don’t really know how long it might take. It could be a very long time before we see the market to rebound.