New content has been posted to the “More…” section: Renting Vs. Purchasing: Buy If You Must. Why Must You Buy? by Eleua and yours truly (The Tim).

One additional comment I would make about the analysis is that I’m not trying to say that no one should ever purchase a home. I’m just saying that home ownership should be sought after for the stable roof over one’s head rather than for some sort of financial gain. Even in a balanced market, ownership is not going to be a money-making venture. As Eleua puts it, you should look at buying a home “as your nest, rather than your nest egg.”

Don’t miss this excellent piece from the Wall Street Journal: Why your home isn’t the investment you think it is.

Your home means a lot of things to you, most of them good. Your home gives comfort and protection to you and your family, and it could well embody all your material hopes and dreams.

But houses have become much more than just places to live. Your home is probably your biggest asset, and the price you could ask for it today is almost certainly much higher than what you paid for it back whenever.

As a result, houses have become substitute credit cards, as profligate owners borrow their equity to finance everything from cars to vacations. Among thriftier owners, the equity they have built up in the family home has become a vital part of retirement planning — a “fourth leg” of the now-unstable “company pension/personal savings/Social Security” stool that was long the model for a financially secure old age.

Unfortunately for both groups, however, houses are not very good investments. For the grasshoppers, there’s nothing quite as stupid as paying off your 2002 trip to Orlando in 2032, when you finally settle up your refinanced “cash out” 30-year mortgage. And for the ants, economic studies have demonstrated over and over that houses (1) cost more than most people make when they sell and (2) rarely match the long-term returns of stocks or other investments.

Summary: Buy a home to live in. Invest your money somewhere else.

On the eve of the spring real estate selling season comes a new resource for potential home buyers: Priced Out Forever. Here on the blog you’ll find the latest news about home price trends, lending, and just about anything related to the concept of being priced out forever.

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