Therefore, it is with no intentional disrespect to Mr. Irvin Dawid who summarized a real estate report from the San Francisco Examiner, that I take issue with his usage of the word "practical"-
"The foreclosure crisis has made it more practical to buy rather than rent in 72% of America's 50 largest cities." http://www.planetizen.com/node/47903
Dictionary.com defines practical as- definition #7- mindful of the results, usefulness, advantages ordisadvantages, etc., of action or procedure.
However, I would say, is it any more practical to buy a house (or condo or townhome) than to rent just because it is currently "on-sale"!? A six pack of toothpaste may be on sale at significant savings (let's say $4 instead of $10 for the same net weight had I purchased the same six pack not on sale, or even more so, say $12 if I bought the net weight in individual tubes) and is therefore "practical." I will need toothpaste in the foreseeable future. In fact, I will technically need toothpaste until the day of my demise be it tomorrow or be it in 2052. But do I need 6 tubes of it all at once??? Probable not, and while I doubt one must play hard and fast with toothpaste's expiration date, it is likely that they will reach their best-by date before you are done with half of them.
Now take this example and blow it up into house-sized proportions! A house, also known, as the biggest financial investment of your life. Unless you're a sheik who buys islands and small countries to put in your investment portfolio. A house that requires maintenance, invokes property taxes, and is hard to liquidize on a whim in a tough market such as the one that we are currently experiencing.
I've been following the current mortgage crisis with the morbid curiosity of a rubber-necker at a crash site. And there have been multiple books written on the subject. A cursory Amazon search shows that several people have done their homework and are now eager to have you buy their research: from the benignly-titled I.O.U.: Why Everyone Owes Everyone and Why No One Can Pay by: John Lancaster (I read this and highly recommend it), False Profits: Recovering From the Bubble Economy by: Dean Baker, to the damning- the Monster: How a Gang of Predatory Lenders and Wall Street Bankers Fleeced America- and Spawned a Global Crisis by: Michael W. Hudson to the poetic- Crash of the Titans: Greed, Hubris, the Fall of Merrill Lynch, and the Near Collapse of Bank of America by: Greg Farrell and the Christopher Buckley-esque- All the Devils Are Here: the Hidden History of the Financial Crisis by: Bethany McLean and Joe Nocera. I imagine that B&N and Borders will have to dedicate a new section in their stores entitled What the F Happened!? Though I imagine that the Financial Section will just be expanded.
Therefore, this isn't any different than having people who didn't understand the intricacies, nor the interest schedule, for a sub-prime mortgage sign up anyway. Let's not get land-happy just because it's at a discount. Get it because your lifestyle needs are changing- your family is growing, your knee isn't getting any better with age and a one story (heck on a lakefront!) is more appropriate for your needs, etc., but not just because the open house had shiny granite countertops and you're regretting your Corian. When the water heater breaks in the house that has the shiny granite countertops because an unscrupulous developer tossed in the bargain-basement water heaters because s/he wanted to shave off a few pennies on their side and you're out $1,500 while the water heater in your Corian house quietly hums away, you'll have no one to blame but yourself.
On a related plug, one of my prior Amazon popped up this book- Our Lot: How Real Estate Came to Own Us by: Alyssa Katz. I think I borrowed it from the library, but have yet to read it. If you finish it before me, let me know what you think! And to all- caveat emptor.
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