[quote=poorgradstudent]In general home ownership is less useful for single guys without kids. One huge perk of being a single guy without kids is if a job opportunity pops up in Seattle or San Francisco or Tokyo you can pick up and go. Buying a place can limit that.
The big perk would be if you are renting for $3,000 a month and can find a place to buy where your mortgage and taxes are less than that, you can potentially free up cash every month. And there are tax benefits for the mortgage deduction, and that single guy making six figures isn’t getting the same deductions those of us with kids get.
I have no clue where housing prices are going to go. All of Rich’s data suggests there is little supply to drive down prices. But the fundamentals seem rather poor if you look at incomes vs. prices. I guess if you go in expecting no appreciation and only look at tax benefits and a mortgage less than current rent it might be a fairly safe bet?[/quote]
Though none of us truly knows where prices will go in the near future, it sounds like your friends are doing well as renters, at least for now. But if they can find something that is at least as nice as what they’re renting for the same or lower cost, they might be okay with buying if they don’t plan on needing to sell — or get back all of their money if they do need to sell after the market has dropped. They should be mentally/emotionally/financially willing to do a short sale in the future, IMHO.
Personally, I’m 98% convinced that we are in another bubble, but I would be tearing my hair out now if we were still renting. Watching the housing market has been painful, and I feel badly for those who do not yet own, but who have reached a stage in life where home ownership would otherwise be appropriate.
