[sttrqiss]

As a life-long renter, I don't see the fuss. The money that would have gone into a down payment is sitting in my savings account and the money that would have gone into the operational costs and taxes tied to ownership is sitting in a retirement account easily worth more than my equity in a mortgaged home would be worth if I'd bought 15-20 years ago.

The only real-estate scenario that has ever made sense to me is buying a property to rent it, or buying a multi-unit to rent the other units and offset your mortgage. I may do one or both at some time, but for now, I'm a happy renter.

http://blogs.reuters.com/felix-salmo...-buying-homes/

Earlier this month, talking about a housing market unsupported by Uncle Sam’s billions, I said that “the entire housing-finance business in the U.S. would come to a screeching halt. No one could buy, no one could sell, and home values would be entirely hypothetical.” What I didn’t realize was that we were plunging towards that state of affairs even with the vigorous and active involvement of Fannie Mae and Freddie Mac.The National Association of Realtors said sales dropped a record 27.2 percent from June to an annual rate of 3.83 million units, the lowest level since May 1995.
The number is so low that it looks like a statistical aberration: let’s hope it is. Because if it isn’t, the news is gruesome. It means that despite record-low mortgage rates, people aren’t able to buy houses: essentially all the benefit from those low rates is going to people who already own their homes and are taking the opportunity to refinance.

The news also means that there’s a big gap between buyers and sellers: the market isn’t clearing. Sellers are convinced that their homes are worth lots of money, or will rise in price if they just hold out a bit longer; buyers are happily renting, waiting for prices to come down. And entrepreneurial types, whom one would expect to arbitrage the two by buying houses with super-cheap mortgages and renting them out at a profit, don’t seem to have found those opportunities yet.

Houses are rarely a liquid asset; they were, briefly, during the housing boom, but now they’re more illiquid than ever. America is a country where two generations of homeowners have learned to consider their houses an asset; they’re rapidly learning that at times like these, a house can look much more like a liability. (And refinancing your mortgage is just liability management.) The enormous repercussions of that change in mindset are only just beginning to be felt.

[Fertionbratte]

Let me help the experts out on this one. If people are unemployed---or they think they may be unemployed soon---the last thing they're going to do is run out and buy a house. Doesn't matter how low the interest rates are, doesn't matter how good the bargains are. Having the largest tax increase in human history on the horizon doesn't help either. Comprende?

Low prices and rates can't slow fall in home sales

Low mortgage rates and prices fail to stop home sales from sinking to weakest in 15 years

http://finance.yahoo.com/news/Low-pr...html?x=0&.v=10

[idobestbuyonlinepp]

So, what's the argument for buying a home? Forced retirement savings 15-30 years at a time with massive interest payments to a bank for the privilege?

[wMceqj7F]

As opposed to renting, where you have a 100% loss every month. If your rent is anywhere near what your mortage payments would be............................. Perhaps California is different with their incredibly high (overvalued) house prices.

Most homebuyers though are not first time homebuyers, the problem is if you can't sell your house you cannot buy the house of the person who wants to buy their next house ... and on.... and on.... The lack of homebuying is due to the lack of homebuying, cyclical. Need to break the cycle which is unlikely to happen until people feel secure enough about their place in the economy and are able to push home prices up a little and get the snowball rolling the other way.

[squeerisott]

Here's an interactive calculator that plots out whether is makes sense to buy or rent against certain criteria. For me, at my rent level and the cost of owning anywhere near here, it's clear that I'm on the right path.

http://www.nytimes.com/interactive/b...alculator.html

As the story notes above, in times of economic volatility, a house can prove to be a very illiquid asset, particularly as valuations decline, which I entirely believe to be a generational shift in perspective. That is, I think home prices will be range-bound for the next decade or more as the hangover of the housing boom continues to play out. And I think an entire generation will find renting more appealing than owning as part of a strategy of diversifying one's assets into more liquid buckets.