Two years ago we were thinking of moving to Albuquerque.  I compared the costs of rent versus the cost-of-purchase and found a house would have to increase in value by 8%/yr to make-up the difference.  The new house prices in Albuquerque have increased over the last two years while the rental market has fallen thus today the contrast is even starker and yet people are still buying houses.  Apartment owners are so desperate for income they are offering first and last months free AND a move-in bonus for clean, substantial, 2 bedroom flats of 1,200 sq ft or 220 square meters with a monthly rent of $600.  For a for a two bedroom 1,200 home the monthly purchase payment is about $1,250.

It's madness.