Total Cost Of Ownership

I'm starting out on my quest for the American Dream with an open mind and a limited purse. The only real limitation I'm putting on myself is the geographical area, which I'm limiting to South Western New Hampshire, Southern Vermont or Western Massachusetts. It would be easy to look at New Hampshire and think that with no state income tax and no sales tax, it would be the cheapest place to buy a house, but the real estate taxes are high and the houses themselves aren't cheap. I plan to put quite a bit of effort into looking at the total cost of ownership to buy a home, especially for a self employed individual like myself.

Location aside, which isn't an easy thing to say in any discussion about real estate, I have to decide how much house I want. I've lived for the last ten plus years in apartments that you could measure in mattresses, as in, if I covered the floor with mattresses, would it take four or eight? I have no desire for a 3000 to 4000 sq ft sheetrock castle, and on the right property, I'd go under 1000 square feet without hesitation. It's easy enough to build more house if the need arises. The question as to whether I would buy land and build from scratch is open. I tend to lean more in the factory house direction than stick building, and I don't want to spend $50,000 just doing the septic, driveway, and getting utilities connected. After spending six years working on my friend's timber frame in the country, I think I have my eyes wide open.

The main problem I foresee is that of choice. Since I work at home and don't have a wife or kids, I only have to please myself. I'm leaning more to the country than the town because I'd like to get into some serious acres, but I would look at the right property in town if it allowed me to get to the supermarket without driving, especially if I could find a mixed-use building with commercial possibilities. A garage is a must in town, a barn or large shed would be even better in the country. One of my flakier ambitions in life is to build an electric car, which just wasn't a possibility while living in a third floor apartment. Another is to have a place to work on, and I know from experience that I'd find it easier to motivate myself to work on a commercial property than something for my own comfort.

Besides deciding on the where and the what, I have some thoughts about home ownership and house pricing in general that I want to explore. For example, I've been expecting housing prices in my area to fall for years and years, but they just keep climbing. I'm beginning to wonder if the reason has less to do with a housing bubble than a currency bubble. The house prices may be reflecting the true value of the dollar, which is overestimated by our current inflation index. If I worked in Europe and was paid in Euros, I'd have seen my purchasing power in the American housing market rise almost 50% over the last few years. It's entirely possible that housing prices will remain at their inflated levels, and everything else will have to inflate to catch up!

So, the goals I'm setting for myself are to survey the housing prices and costs in the areas I'm interested in, to research the aspects of buying a home that I'm not familiar with, and try to settle my mind on what exactly I'm looking for before I'm out on the streets in early February.