Lin

Richard-

I understand your guidance and prudence on this issue- and agree that younger buyers/renters should proceed with caution when contemplating purchasing a house for a shorter 5-10 year period. I cannot however get over the fact that when I am renting, I am basically squandering $12000 annually on something that I cannot claim to be mine and never see a return on at the end. There are no "fruits of labor" to look forward to and basically no labor to qualify for any fruit in the first place. You can't sell an apartment you've been renting for the past 5-10 years but you can sell a house that you purchased 10 years ago- even if you *don't* make any profit off of it, or even lose a little (and yes I haven't factored in all those extra interest rates on mortgages, taxes, and maintenance fees)- at least you're not losing 10 years worth of $12000 rent money.

That being said I agree that buying is still more risky and may be a trap for people who don't fully understand those risks. I like how Suze Orman put it: " So I can imagine that those of you who are still renting might be mentally kicking yourself right about now. I am willing to bet all you can think about is how much money you would have made if you had already purchased a home. I have to tell you that sort of thinking sounds dangerously like the investors in 2000 who thought they were losers if they hadn't jumped on the technology stock craze. And we all know how that story ended. "

Well I haven't found a house yet so cheers to renting (for now)! - Thu Jun 19 2008, 07:08

According to an April 2007 NYTimes business article: "House prices have to fall more before housing becomes a clear buy again,” says Mark Zandi, chief economist of Moody’s Economy.com, a research company that helped conduct the analysis. “These markets aren’t as overvalued as they were a year ago or two years ago, but they’re still unfriendly. And that’s one of the reasons the market is still soft — people realize it’s not a bargain.”

I'm sure there are much better investment strategies that owning a house but the "home" factor does add priceless value to buying a house instead of renting. You can paint your walls any color, at any time, patch up the roof on your own schedule, and just simply enjoy the basic responsibilities of home ownership. But after reading a myriad of articles about the finances to purchasing a home: property taxes (exorbitant in New Jersey), maintenance fees, repairs, interest on your mortgage payments - it does seem rather daunting. And with some mortgages you can't even tap into the equity until you've gotten the mortgage down to an manageable number (and/or after 5+ years).

Thanks for all your advice! I can't wait to sum up everyone's opinions on this matter. - Wed Jun 18 2008, 11:33