Of course, at this time the housing bubble is still deflating, so this kind of calculation heavily favors renters in many areas.
The guy at Shadenfreude Central, a.k.a. www.irvinehousingblog.com, recommends computing the ratio of a house's sale price to the monthly rent for an equivalent house. The charts on this page:
assert that the national historic norm for this number is about 180: i.e. a house that rents for $3k should cost about $3k x 180 = $540k. As a rule of thumb, if the sales price is significantly more than this calculation would suggest, it's a good time to rent instead of buying.
Having said all that: The reason to buy a house was well articulated by Christopher Alexander in A Pattern Language (which, as all pattern-wielding Java programmers should know by now, is a classic):
Pattern 79. YOUR OWN HOME
People cannot be genuinely comfortable and healthy in a house which is not theirs. All forms of rental - whether from private landlords or public housing agencies - work against the natural processes which allow people to form stable, self-healing communities...
This pattern is not intended as an argument in favor of "private property," or the process of buying and selling land. Indeed, it is very clear that all those processes which encourage speculation in land, for the sake of profit, are unhealthy and destructive, because they invite people to treat houses as commodities, to build things for "resale," and not in such a way as to fit their own needs.
And just as speculation and the profit motive make it impossible for people to adapt their houses to their own needs, so tenancy, rental, and landlords do the same. Rental areas are always the first to turn to slums. The mechanism is clear and well known. See, for example, George Sternlieb, The Tenement Landlord(Rutgers University Press, 1966). The landlord tries to keep his maintenance and repair costs as low as possible; the residents have no incentive to maintain and repair the homes - in fact, the opposite - since improvements add to the wealth of the landlord, and even justify higher rent. And so the typical piece of rental property degenerates over the years. Then landlords try to build new rental properties which are immune to neglect - gardens are replaced with concrete, carpets are replaced with lineoleum, and wooden surfaces by formica: it is an attempt to make the new units maintenance-free, and to stop the slums by force; but they turn out cold and sterile and again turn into slums, because nobody loves them.
People will only be able to feel comfortable in their houses, if they can change their houses to suit themselves, add on whatever they need, rearrange the garden as they like it; and, of course, they can only do this in circumstances where they are the legal owners of the house and land; and if, in high density multi-story housing, each apartment, like a house, has a welldefined volume, in which the owner can make changes as he likes.
The guy at Shadenfreude Central, a.k.a. www.irvinehousingblog.com, recommends computing the ratio of a house's sale price to the monthly rent for an equivalent house. The charts on this page:
http://www.irvinehousingblog.com/blog/comments/wot-3-22-2008...
assert that the national historic norm for this number is about 180: i.e. a house that rents for $3k should cost about $3k x 180 = $540k. As a rule of thumb, if the sales price is significantly more than this calculation would suggest, it's a good time to rent instead of buying.
Having said all that: The reason to buy a house was well articulated by Christopher Alexander in A Pattern Language (which, as all pattern-wielding Java programmers should know by now, is a classic):
Pattern 79. YOUR OWN HOME
People cannot be genuinely comfortable and healthy in a house which is not theirs. All forms of rental - whether from private landlords or public housing agencies - work against the natural processes which allow people to form stable, self-healing communities...
This pattern is not intended as an argument in favor of "private property," or the process of buying and selling land. Indeed, it is very clear that all those processes which encourage speculation in land, for the sake of profit, are unhealthy and destructive, because they invite people to treat houses as commodities, to build things for "resale," and not in such a way as to fit their own needs.
And just as speculation and the profit motive make it impossible for people to adapt their houses to their own needs, so tenancy, rental, and landlords do the same. Rental areas are always the first to turn to slums. The mechanism is clear and well known. See, for example, George Sternlieb, The Tenement Landlord(Rutgers University Press, 1966). The landlord tries to keep his maintenance and repair costs as low as possible; the residents have no incentive to maintain and repair the homes - in fact, the opposite - since improvements add to the wealth of the landlord, and even justify higher rent. And so the typical piece of rental property degenerates over the years. Then landlords try to build new rental properties which are immune to neglect - gardens are replaced with concrete, carpets are replaced with lineoleum, and wooden surfaces by formica: it is an attempt to make the new units maintenance-free, and to stop the slums by force; but they turn out cold and sterile and again turn into slums, because nobody loves them.
People will only be able to feel comfortable in their houses, if they can change their houses to suit themselves, add on whatever they need, rearrange the garden as they like it; and, of course, they can only do this in circumstances where they are the legal owners of the house and land; and if, in high density multi-story housing, each apartment, like a house, has a welldefined volume, in which the owner can make changes as he likes.