Buy vs. rent ratio--AGAIN

Any analysis is static and much depends on your view of the future. The assumptions you make will favor one choice over another.

Short the market.

JP78: "...locking up a low rate would be nice."

What about the part about 'locking up a higher purchase price?'

Interest rates go up and down. With a high rate, you can refinance down the road, or pay off the mortgage early if you're able. With a higher purchase price, you are truly 'locked up', because there is nothing you can do about that.

Agree that higher rates can be negotiated down *eventually*, but bears have been saying that there will be huge interest rate spikes for two years now. Hasn't happened, doesn't appear likely any time soon. If you think that prices will rise over the next 5-10 years and can find a place you're happy to live in for that period of time AND it works with your budget, I think it makes a lot of sense to buy, as prices appear to be stabilizing. As Riversider notes, it depends on your assumptions about the future.

JP78, we did just that. Put 30% down, took out a 15 year loan at 4.5% (probably could get closer to 4% now), and bought a place we love and can see ourselves in for a long time. We're both 30, and there's a lot of appeal in having this place paid off by age 45, at which point we can buy a suburban home or a beach home while keeping this one.

The math worked out very well for us. It's hard to do an apples-to-apples comparison because the place we bought has unique features, but we're paying less per month than we would in any rental that was acceptable to us, even accounting for the lost interest income.

I realize prices could go down, interest rates could go down, rents could go down, etc., etc. I can't obsess with every "what if" factor like some on this board do, nor I can convince myself that some doomsday factor is going to depress prices to the point that it will be significantly better to wait when (for us) renting was costing as much or more than owning.

I have an apartment I love, can customize the way I want, can afford easily, and is cheaper than any acceptable rental. My payment is unlikely to change much for the next 15 years (and there are a few factors, like building mortgage refinance, that may even LOWER it), and I will be DONE paying mortgage at age 45. I'll take those guarantees over any speculation.

I totally respect the bears on this board and maybe in the end they'll get the best deal. That's fine with me. I am happy with my choice and will have no regrets.

Another point against buying at a lower rate and higher price is that if you have to sell for whatever reason within the next few years, you are more likely to end up losing part or all of your equity/down payment.

My main point was to address your statement about 'locking up a low rat'.' As for buying now vs. later, I think it really should come down to whether you believe prices have stabilized instead of basing it on mortgage rates. Of course each person's situation is slightly different and it might makes sense for you to buy now for other reasons. Again, I was only addressing your point about low rates being a reason to buy.