Reply #32: If you feel better in a rental, stay. [View All]

[Gormy Cuss]

The fact that your rent is so low relative to the house's value is a big warning sign. I made the same choice in an earlier scary housing market. I saved money for a bigger down payment while friends scrambled to get in overpriced housing thinking it would last forever. It didn't and I knew more than a few people who owed more than the market value. They had to take a loss or sit tight until the market approved. When prices stabilized I was able to buy a house in a nice town without creative financing or PMI. In fact, the previous owner of my house had purchased it at the peak of the earlier run-up and had to wait five years for prices to recover. The crazy appreciation of the last few years is nice, but the important valuation for me is that the housing market could crash and I'd still be ahead.

Mrs.Grumpy, thanks for sharing an appraiser's point of view.