davidpeace, I’m in almost the same situation you are with a baby on the way. I am currently renting a nice big 2 bed condo in mission valley for $1250 a month. Let me repeat that – $1250 a month. Between my wife and I we could afford to pay much more but we are enjoying saving the extra money and now we can sit back and watch housing prices fall and jump in anytime we are ready. I too get frustrated at not having my own home but then again I make up for it by buying motorcycles, taking road trips and whatever I want with the extra money we have. Its really about what makes you happy. If you have the option you might want to get out of that contract and wait a little longer.