I like the roller coaster metaphor, it’s a great illustrative device, with an angle sympathetic to people who are having trouble entering the housing market or stand to get in trouble when the housing market drops.

The rent vs. buy calculator, reassuring though it is, is based on the assumption that you have the same amount of money, and could totally afford to buy a house, but instead you’ve invested the same amount of money you would have spent paying the mortgage and down payment. (Under methodology, they cite ‘opportunity cost’ which is all about having the money to do something else with). I think this method is pretty bunk in this application. It’s not really rosy like that interactive graph implies for those of us who rent because we can’t afford to buy, and are therefore not running around with the quote-unquote ‘extra’ dough investing it instead. We’re buying groceries with it, and light, and heat and just plain not having the rest. Silly us.

By the way, Evan, I think the media has been responding to the sub-prime mortgage lending failures with reasonable alarm. Also, though I’d never considered spates of foreclosures flooding the rental market before, I think lower home prices usually just result in lower rental prices. All bets are off in a crash though. And, just to reiterate what I’ve been saying for several years now, I do think we’re facing a housing crash.