The Next American Dream

Earlier in April 2012 a traditionally strong home-buying month, we saw a positive turning point in the US house prices as mortgage rates were record low. This led us to believe that the housing market was on its path to recovery since the bubble bursted more than five years ago. Not only was this news a short-term glory that lasted only until June before consumer confidence was announced to have remained low, success in the real estates industry was not mirrored in the wider US economy.

Why the lack of confidence in real estates? 
With about two-thirds of the trillion dollars student debt belonging to those under 40 year-old, young people are graduating from college this summer deep in debt. The current employment growth does not help them to much extent. In April and May, employers have added a little over 70,000 jobs on average, which is a significant slowdown from the 200,000 job additions from January through March. Like many of my graduating friends from Berkeley, many of these kids will move home to live with their grandma, teach English abroad in Asia, or go to grad school and continue renting shared apartments. They are not looking to start a home.

Is renting the next American dream? 
Housing isn't as simple as renting textbooks for the semester - many still believe that buying is hands-down the better deal. Rents are high, mortgage rates are low, foreclosures are everywhere. Forbes has listed ten best cities where buying beats renting right now. Below are the top 5:

1. Detroit, MI
2. Oklahoma City, OK
3. Dayton, OH
4. Warren-Troy-Farmington Hills, MI
5. Toedo, OH

Would you buy or rent?