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"Would you pay 100K$ + for a run down mobile home?"

No. If I didn't like the state of the local housing market I'd take advantage of the mobile part of "mobile home" and buy a used one for $2,500.00 in Alabama, or I'd buy an RV or a house boat (new house boats sell for under $100k, btw). Then I'd move it to the real-estate bubble-zone where I had to live (one presumes, for a job).

You can talk all day long. You can convince yourself that you are making the smart-money play by renting, but in the end you are only harming your own finances.

Your rent is probably your largest single monthly expense, and yet that money is being entirely consumed. Rent money builds no equity. Spending money on rent is the same as burning your cash every month because it is just as gone either way. You don't get your rent money back.

That's a heck of a thing to say about your largest monthly cash expenditure, that you don't get it back.

You are probably wrong about the housing bubble. Real-estate prices aren't determined by how much people make, are taxed, or how far prices have increased in the past.

Real-estate prices are determined by supply and demand. If more people are moving to your area, then housing prices go up. If everyone moves out of your area, then housing prices will plummet.

If you aren't sure what people are doing and don't know how to figure out current and future demographic trends, you can always buy and live in a more mobile form of domicile rather than "risking" your money in the normal housing market.

But people don't rent to escape a housing bubble. People rent to maximize their convenience or lifestyle. Sometimes they don't want to commute. Sometimes they want a certain "prestige" of a neighborhood. Sometimes they just want to be lazy. Other times renters just don't want to part with the down payment needed to buy a house.

In some areas such as in San Francisco, not only do people rent, but they share their rental units with multiple other people, all in order to be in a trendy neighborhood close to all of the "Action". Renters in those types of areas don't even think of themselves as potential buyers. They have an image of themselves based on entirely different things (e.g. who they know, how they dress, where they work, club persona, et al). Heck, 20 or 30 years ago they might have even treid to kid each other that the reason they rented instead of owned was because of a "bubble", but housing prices have increased so steadily for so many decades that such thin rationalizations have been tossed aside from those areas.

Renting might be fun or convenient, but it's no way to succeed financially.

No. If I didn't like the state of the local housing market I'd take advantage of the mobile part of "mobile home" and buy a used one for $2,500.00 in Alabama, or I'd buy an RV or a house boat (new house boats sell for under $100k, btw). Then I'd move it to the real-estate bubble-zone where I had to live (one presumes, for a job).

Now, there's an idea. Always wanted a house boat...did I mention there is also a drought and the lakes are drying out..not enough water to support the growth...The 400K$ McMansions are pretty funny looking surrounded by dead grass.

Your rent is probably your largest single monthly expense, and yet that money is being entirely consumed.

No the my biggest monthly expense is the Federal Government.

They have an image of themselves based on entirely different things (e.g. who they know, how they dress, where they work, club persona, et al).

Again this is secondary...The folks who live 10 miles from the fashion victims are in the majority and in the area for the JOBS. They have also been priced out of the housing market....No first time buyers means no second time buyers...

Reuters Business Report

Double-Dip Recession Unlikely-Fed's Poole

NEW ORLEANS (Reuters) - St. Louis Federal Reserve Bank President William Poole said on Sunday the odds the U.S. economy might fall back into recession given the stock market's recent woes were "very, very small."'

................................... CAUSES FOR CONCERN

But he warned of some potential clouds on the horizon that could lead to instability in financial markets, zeroing in on the heavy debt load of mortgage market giants Fannie Mae (NYSE:FNM - News) and Freddie Mac (NYSE:FRE - News).

The two so-called government-sponsored enterprises, or GSEs, had $1.3 trillion in debt outstanding at the end of last year and, according to Poole, had guaranteed another $1.8 trillion of mortgage-backed securities.

"In the case of the GSEs, the massive scale of their liabilities could create a massive problem in the credit markets," Poole said. "If the market value of GSE debt were to fall sharply ... what would happen? I do not know, and neither does anyone else," he said.

Fannie Mae and Freddie Mac, while shareholder-owned companies, were chartered by Congress to provide a deep and even flow of funds to mortgage markets, which they do by buying mortgages and repackaging them as securities for investors.

Under their charters, the firms have credit lines with the U.S. Treasury, which -- although never tapped -- many think have contributed to a view in the market that the government would stand behind their massive debts.

"I do not see any immediate risk of a GSE debt problem, but am not willing to assume that in different conditions in the future one could not occur," the St. Louis Fed chief said.

Poole said the credit lines the GSEs have with the Treasury Department should be withdrawn, adding that they could be replaced by credit lines at commercial banks.

In addition, he said the companies over a period of years should add to the amount of capital they hold. He said both Fannie Mae and Freddie Mac hold a level of capital "well below" what is required of banks.