"which is just as important as the well-established idea that owning a house is a great way to build wealth"

This is just factually wrong and absolutely horrible to include it in this advice.

A house is NOT a wealth building vehicle. This is only true of investment properties, but NOT your residence. Why? During normal times (plz refer to graphs published by the Federal Reserve of Denver for these facts-- you can also find articles that perform analysis to this affect on NY Times, Washington Post & USA Today, I provide a link to one article at the end of this post) the rate of appreciation of your home is between 3%-7% and is normally pegged to the going inflation rate of the greater economy, both at your local level and the national level. What this means is that unlike the last boom which started after the deregulation of lending industries and the drop in interest rates in 2000 & 2001, when you buy in and then sell, you should get back your down payment + any equity you've paid down (not the interest) on your mortgage, plus an "inflation adjustment" of an additional 3% - 7%. Like this, you can take your down payment, plus paid equity and apply it to your next house, having ridden a wave of inflation that allows you to leverage your EXISTING deposits to equity. That's a far cry from how things were during an unsustainable boom in values.

Since I felt the blogger dodged the question at hand, here's your advice: don't buy now. Your husband is right. Solidify your positions by paying off interest bearing debts, creating a disaster fund and either consolidating remaining debts into your mortgage so you can deduct a portion of any interest expense, OR, pay down all debts to very low levels and consolidate them to zero-percent interest credit lines, moving them from one to another when the introductory rate expires.

I wonder...are you paying interest on a student loan when you have $100k sitting in the bank? Are you paying interest on your mortgage too? Why?

Here's what you should do right now, and in order:
1) Add up your total monthly expenses-- meals, entertainment, bills, mortgage-- everything.
2) Calculate 6 months worth of expenses-- that's your "disaster savings" as I like to call it. If either of you lose your job, this money's job is to cushion the fallout so there is no impact to your credit ratings, or if the need to sell arises, or even unexpected medical expenses.
3) Next, tally up the debts on which you are paying interest-- including your mortgage. If you have any money left after creating a disaster fund, pay down interest bearing debts right away. If you can, bring them within range of the ability to transfer those debts to a zero-percent credit line and consolidate them accordingly...word of caution: zero-percent offers are getting increasingly tricky, once you transfer into that credit line, DO NOT USE IT. That will result in your interest-bearing balance increasing while you pay down the interest free portion, thereby eliminating your savings...another trick that banks are pulling onw is requiring you to make at least two purchases per month to maintain that zero-percent after an "introductory period." That's another way to extract interest from you, so be weary of those tricks.
3) (and alternative #3) Pay down your debts and consolidate any remaining debt to your mortgage, like this, any interest you pay is deductible...however, you should sit down and calculate if your itemized deductions on your tax return will be higher than your standard deductions. Note that for most people, it standard deductions are higher, which means you don't get ANY benefit from paying your mortgage. Whether you use this alternative or the first #3 I detailed above, is up to your personal financial situation and analysis.
4) If you have any money left over at this point and are in the mood to build wealth-- buy into long term market funds-- the lows of the stock market are happening right now and you can make good money if you buy into long term positions.

You and your husband should ask yourselves: do you really NEED a house? Do you need the additional taxes? Do you need the additional cleaning expenses/time? Do you need the increased utility bills? How about the added time/expense of lawn maintenance? Pool maintenance? Furthermore, do you really want to run the risk of taking a mortgage or putting down your cash savings only to end up losing money when you can improve upon your financial positions without major exposure to risk?

Be very weary of articles that say the "bottom" is now and "bargains" can be had. Barrons (major financial magazine) notoriously published a cover article a few months ago that declared the bottom. Obviously, they were wrong. The broader economy is tanking, and real estate is indeterminate at the moment.

My advice is simple: get rid of debts, and prepare to ride the upswing of investment opportunities in the stock market. The real estate market has further corrections to make and will only stay flat after that for a while. This real estate boom/bust cycle has happened three times in the last 50 years (the last one was in the late 80's early 90's) and this pattern will hold true. While not as sharp as the current one, it still happened. Another thing-- don't call a purchase a bargain if it is discounted from an overinflated price. My recommendation is to go to the county appraisers web site (www.bcpa.net in Broward, www.pbcgov.com/papa in palm beach) and look at what the house sold for, before the boom. Look for a purchase of around 99-01. now, take that price and add 4% per year until you hit this year, and THAT is a more accurate price for the home. Now...you'll know it is a bargain depending on how much above, or below that number the house is.

Plan your finances carefully by running various scenarios including next year's taxe returns. And don't fall sucker to that old "oh, well, my mortgage interest is deductible" scam either. Yes, it is deductible, but does it make sense to give a stranger $1000 if you'll only get back $250 from the government? That's pretty much what you're doing with your mortgage "deduction."

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Here's an article that will help you understand home values, appreciation, inflation and other such data more holistically:

http://www.nytimes.com/2008/08/09/business/economy/09bargain.html?_r=1&scp=3&sq=real%20estate%20bust%20income%20ratio&st=cse

I'm a very high earner myself (six figures+++) and my wife stays at home with our children. After reading the comment by Reuben and the blog posting by the author I have to say that I agree with Reuben. Pay down your debt, put money away for a rainy day and prepare to grow the leftover money aggressively. While he states the stock market, I'd tread cautiously there and go for a tax deferred vehicle instead like an IRA or something. If not, then use mutual funds. Another thing I'd like to add: homes still have a ways to go and if your husband feels a risk, you should respect his intuition.

Thank-you both for the advice. I really appreciate it. I didn't really feel that the answer by the financial planner helped us, as we already knew those basics. We don't really have any debt, except for my student loan which is on hold right now due to my working on my master's degree. The interest rate is only 4.5%. Yes, we really need a home as this was his home as a bachelor and it's too small for the two of us and I dislike it. We have made some small inexpensive improvements to it to make it tolerable for me. I guess we will wait a bit longer for prices to drop more and work on building up the 6 month emergency fund. Thanks again!

If you cant pay cash you cant afford it ! that goes for your house, your cars and your kids. Duh!