Let me try to clear this one up... Lots of bubblesitters and bitter renters battling desperate homedebtors on HP threads it seems.
If you buy a home today vs. renting, you are a fool. Renting is significantly cheaper on a monthly basis than "owning", and if you "buy" you'll lose not only the extra monthly cash flow vs. renting, but more importantly you'll also the negative depreciation to deal with. In addition, you'll have the transaction costs of buying and selling, and you'll likely be locked into the home or a significant loss for years, unable to move for a new job when you lose your current one or are offered a better one during the upcoming recession.
If you "own" a home you "bought" pre-bubble, you're doing fine (unless you did equity-extraction). "Owning" your home today is likely at a similar monthly cost to renting, if you bought pre-bubble. The only issue you have to sleep on is that you'll be losing some of your possible equity every day now that homes are depreciating vs. appreciating. However, if you took out HELOC's, you screwed yourself.
The smartest financial play for "owners" would have been to sell at the peak, over a year ago, cash in, put the money to work, and rent. Then when prices stopped falling, buy again.
The smartest financial play for renters who've never "owned" would have been to buy a home pre-bubble, then sell at the peak and rent again. If you've always rented and didn't buy and sell, you missed an opportunity to make some money off the stupidity of your fellow man during the greatest ponzi scheme the world has ever seen.
If you buy a home today vs. renting, you are a fool. Renting is significantly cheaper on a monthly basis than "owning", and if you "buy" you'll lose not only the extra monthly cash flow vs. renting, but more importantly you'll also the negative depreciation to deal with. In addition, you'll have the transaction costs of buying and selling, and you'll likely be locked into the home or a significant loss for years, unable to move for a new job when you lose your current one or are offered a better one during the upcoming recession.
If you "own" a home you "bought" pre-bubble, you're doing fine (unless you did equity-extraction). "Owning" your home today is likely at a similar monthly cost to renting, if you bought pre-bubble. The only issue you have to sleep on is that you'll be losing some of your possible equity every day now that homes are depreciating vs. appreciating. However, if you took out HELOC's, you screwed yourself.
The smartest financial play for "owners" would have been to sell at the peak, over a year ago, cash in, put the money to work, and rent. Then when prices stopped falling, buy again.
The smartest financial play for renters who've never "owned" would have been to buy a home pre-bubble, then sell at the peak and rent again. If you've always rented and didn't buy and sell, you missed an opportunity to make some money off the stupidity of your fellow man during the greatest ponzi scheme the world has ever seen.
