Jim, those really *are* cool pictures! :-) But I have to admit that I "triple-hate" yellow jackets, because I am *extemely* allergic to them. Plus they are very much enamored of bindweed which I despise just about as much as them. Those two dirty rotters go "hand in hand". Sure they have their place. I totally get that, but I hate them both, nonetheless. :-/ Goes off muttering...*&%@! dirty, rotten', stinkin' yellow jackets and bindweed...phfft!

Also, if you think about it solely in terms of figures...when you need to sell, banks issue mortgages based upon the appraisal. Therefore, buyers need to have the appraisal come in for more than the agreed upon sales price. Generally, appraisers take the price per square foot of other comparible houses in your neighborhood, then adjust the value up or down depending upon condition and finishes. Now, this is a very simplified explanation, and appraisal is not an exact science, but it will give you an idea of the long-range value of the house. So, let's take an example on a 1800 sq ft house. If the average ppsf (price per sq ft) for similar (not exact, but similar) houses in your less than desirablable neighborhood is, let's say, $200, and your house has $40k worth of upscale finishes/renovation, appraised price is $400,000. Then, take the same house, with the renovations, and plunk it into a more desirable neighborhood. Similar houses in the neighborhood sell for $300 a square foot, appraised price is $540,000. Quite a difference, no? I recently spent 2 years looking for my 'dream house', and I ran into the same dilemma as you, time and time again. And I ran the recently-sold house numbers time and time again(used www.mlspropertyfinder.com)...and price values varied, by neighborhood, sometimes more than $200 per sq ft. For me, it was a better investment to wait & find an undervalued house in a better neighborhood. And, after 2 years of searching, I did! Hope this is helpful, and good luck....

Whatever you do, before assuming that the train schedule is accurate, or that such a neighborhood is x hours from work, do a test run. At rush hour. In my subway days, I could count on (1) the train always came when I was about a block from the station, so I had to wait for the next one (2) the train was always delayed by something--people holding the doors, the dispatcher holding the train in the station to make a connection, etc. (3) just because it's a 'subway' doesn't mean it won't be affected by the weather. That goes double for an all-surface train. I second the previous poster who pointed out that unless you're at the end of the line, you'll never get a seat on the train, so forget all those fantasies about sleeping. I'll add that you might not even be able to get *on* the train--plenty of times I had to wait for the next train because the first one was too crowded to get on. Certain trains--like the 7 in Queens--even if you do get on at the end of the line you may not get a seat. It's that busy. So, bottom line, before assuming you can handle a certain commute, make sure you're thinking about that commute realistically. Your '1 hour' commute might easily be 1.75 hours more often than not.

jn3344 is spot on. I didn't want to go into it because it is far too much economic theory for this board and quite frankly not really necessary as people can prove it to themselves with the math and that way I don't have to talk about the theory. Assuming you are in an area without rent control, as a general rule you will find that buying houses are usually better than renting if the interest rate is low enough and you are planning to stay long enough. This is a function of the rental market. Although, the housing market is sporadic and unstable and has all kinds of fluctuations the rental market adds economic smoothing into the real estate picture. Before we go any farther a few assumptions. First, people who buy rental property do so as an investment, next, people who invest expect a return, finally, rental property requires higher annual maintenance than home ownership. I know that landlords can often get better pricing on repairs but they also must address things immediately and do repairs between tenants that homeowners would not. Given all these things we only need to know the return that landlords expect. In general, I am going to use the 20 year risk free rate plus 2%. Now this is both a lower than realistic interest rate and a lower than realistic time frame for most investors, it would probably be closer to 3% plus prime instead of RFR. But I am trying to be ultra conservative. This means that the rental market will set the rates at (real estate price + annual taxes and maintenance) * expected return. Using a $150,000 purchase price and $2,000 per year in repairs and taxes we get $8,840 / year. That is the total annual gain that is expected by a landlord for property he intends to rent out. This doesn't mean that he has to collect it all in rent, if the property is expected to appreciate then rent can be lowered by the amount of appreciation. All of the above means that we can largely ignore maintenance since they will exist for both landlords and homeowners. It also means that when the market rate of interest is lower than expected rate of return (which it certainly is now) then every payment will reduce the impact of transaction costs for home ownership. Over a long enough period of time (about 2.5 to 5 years currently) home ownership will overtake rental as a better financial decision. You also might be tempted to note that no landlord actually does that calculation and largely you will be right. However, you don't have to do the math. The market will push rental rates towards this. Also this only sets a floor for return, the economic equilibrium will establish the actual rental rates so long as they don't drop below these levels. But seriously, when interest rates are this low grab a 15 year mortgage, don't pay cash for your house. It is just a terrible idea right now.