jg,
I too owned a great home in Birmingham Alabama – 2800 Sqft all brick- bought it for $225 in Jan 02, sold it in May 06 for $275K. Moved to CA -OC for great job with a growing company. The return on homes in the AL market averages about 3 to 5% increase a year. I knew it was going to be hard to swallow -buying a smaller house for twice the price, in CA but I packed up the family and came on out. Well after 30 days of listening to my RE agent tell me that know is the time to buy, I just could not pull the trigger, so I found a nice townhome in Mission Viejo – 1800 Sqft – rents for $2200 and moved in. I put my 50k in short term CD’s and keep adding to the savings everymonth, hoping like you that the return of reasonable housing prices will bring the opportunity for home ownership again. You see I am old school, I have no debt, own my cars, and will put 20% down and do a conventional 30/15 year fixed loan. No ARMs or Interest Only loan games for me. I enjoy sleeping at night, even if it is in a rental for now, as I would rather have money in the bank, and patience, than to be fearful of loosing my home due to rising interest rates and shrinking inflated equity.
So, renting is not so bad, enjoy your position. Watch, read, study every angle so that you are in the drivers seat when the time to buy is presented on your terms, not some RE agent’s idea of ideal markets. Afterall it is our lives and our money.
David