1) You can rent housing from a landlord or you can rent money from a bank. In either case you are spending money for shelter. Neither is inherently superior to the other.

2) One absolutely *can* put a price on (i.e. assign a value to) the ability to personalize one’s home. The value will vary by individual, but that does NOT mean the value is infinite. If it were, then no one would rent, even if it were absolutely free.

It may be that the intangible value of owning over renting is worth $20,000 per year to you–then enter that value into your spreadsheet (you do have a spreadsheet, right? ) when comparing the cost of renting versus the cost of owning.

3) It is undoubtedly true that we should return to the attitude of our grandparents regarding housing. Fixed-rate, 20% down, one’s house is not an investment; I couldn’t agree more. But remember, the decision is not just whether to expect outsized gains in coming years (I surely don’t) or whether to use an ARM (I surely won’t).

The question is whether I will be able to get more for my money in 6 or 12 or 18 months. For me this is the decision: do we buy a house that has most of the characteristics my family wants/needs now? Or, do we continue to rent our pleasant but relatively inexpensive apartment for another year and hope for additional declines? For us, just another 5% decline will make a real difference in the quality of home that’s in our price range (using a 30-year fixed with 20% or more down).

Framed in this light, our decision is about *risks*. I have to weigh the risk that prices suddenly increase again against the possibility that prices will decline fast enough to allow us to purchase a nicer place in the future.