If you had $10,000 laying around...

[Topless]

PL, here is the fallacy:
"paying a mortgage with interest, property taxes, maintenance and all the other mandatory costs that go above an beyond the cost to rent"

Long term over the life of a 30 yr mortgage, these costs are always lower than the cost to rent a similar living space. This is an important distinction often overlooked in investment planning. Buffett agrees.

[Perfectlap]

Originally Posted by Topless

PL, here is the fallacy:
"paying a mortgage with interest, property taxes, maintenance and all the other mandatory costs that go above an beyond the cost to rent"

Long term over the life of a 30 yr mortgage, these costs are always lower than the cost to rent a similar living space. This is an important distinction often overlooked in investment planning. Buffett agrees.

who said you have to be in the same rental for 30 years? and who has ever actually lived in the same rental for 30 years?

Putting a cap on your housing expenses, something a primary residence will never allow you to do as mortgage costs are not, nor will ever be, the only ownership cost, basically means that the renter/worker can simply give up convenience/amenities and move to an area where rent is lower or stable. Most importantly this allows the middle class worker to keep their retirement contributions untouched.
Mobility means flexibility in retirement planning. A home owner on a fixed income, without outside sources of passive income, on the other hand is giving up tomorrow to live well or conveniently today. Disaster. Particularly when you consider the fortunes that are being made in the oil/gas industry, health care/pharma/biotech and technology software/services/hardware that these middle income home owners aren't participating in as investors because they have to meet each uptick in the costs to own (aka owe).

Also, we just had a nearly seven year bubble of house-building, and after trillions in intervention by the Fed and Treasury house prices are still struggling five years after this bubble burst. That's a ton of inventory that renters can choose from, even if rent goes up, you can bet that the cost to own goes up that much more if that zip code also has rising incomes.

Basically you have to be extremely careful in doing some very long-term calculations of where you are buying and the expected ownership costs of buying into that zip code. And that's after you've calculated how much your income you can actually spend on the home purchase in the first place. If most people are not doing any of these calculations and simply out-bidding each other for homes (the very nature of RE) then these bidders have basically made it impossible for you not to over pay.