I think the real thing to consider is what it would cost you to rent a comparable home. For the price range you’ve said you’re looking at, I’m guessing you could rent the same thing for around $2000 a month ($2500 tops).
It is tough to predict what’s going to happen to home prices, but it’s pretty unlikely that they’re going to start going up again any time soon, so that means they’ll be flat or declining. That latter makes renting the easy decision, but even if prices stay flat, you probably come out ahead “throwing away money” on rent rather than doing the same thing on interest, property taxes, insurance and upkeep. The only part that’s an investment is the principal you pay and that can easily be devoured if the decline continues.
