Should you Rent or Buy????

Rates are great; Home prices are down, and there's an $8,000 tax credit for 1st time Homebuyers !!!!! What should you do - granted there are other things to consider but here's a little formula for you - What's the Price-to-Rent Ratio?? Determine wheather it makes financial sense to buy or rent in your area, compare home sales prices with the cost of renting a similar place. "Divide the price of the home by the total cost of rent for one year. If the result is more than 20, "I'd be very concerned that the price [of the home] might fall more," says Mr. Baker, and you should consider waiting to buy. If it's 15 or below, he says, "you're probably reasonably safe" with prices holding steady or growing".
information provided by: Dean Baker, co-director at the Center for Economic and Policy Research as reported in WSJ.