The fact of the matter is that the Baby Boomers, the largest cohort of the American population ever are going to be retiring from this year until 2024, there is been an enormous increase of housing supply, we will be in a bear market for a long time (the baby boomers will be cashing out of their mutual funds for income investment vehicles, and the Mutual funds will have to sell a lot of their holdings in order to pay out the distributions needed to accommodate this, and the population cohort following the Boomers is much, much more smaller, and much, much poorer) will all contribute to the fact that there will simply bee a lot of houses, many more than there will be a demand for them.

So I am going to be the brave soul that will be doing it — I am selling my house in late spring of 2007, and buying Euros with these dollars, as the dollar is headed for a dive for many reasons (some of which, because I doubt we will be able to hold onto to the our PetroDollar status — people do not ask why we are in Iraq — they should — Sadaham decided to sell his oil in Euros; The president of Iran has an even worst WEAPON OF MASS DESTRUCTION planned for us, — an oil Exchange tor rival ours and the one in London, which really is also, especially, ours as well, where the oil would be sold in any currency; I do not have to spell this out to you, — the dollar is the most devalued currency on earth, as there is no other currency with as a wide circulation, and if OIL is no longer backing it, then we will suffer in the short-term hyperinflation, and in the med-term, deflation — aka–depression; and then, cash, particularly Euro cash, will be king)

That is what I am going to do. I would advise all of you to take all these macroeconomic trends into consideration when you plan your economic futures.

However, from my perspective a house is a place to live, not an investment (unless of course it’s a rental property). Most people do not cash out of their housing “investment”. They may sell it, but then they move to a new house – which in all liklihood is more expensive as well… The only time people actually “cash-out” is when they move to a smaller home, e.g. a retirement community.

Here are interesting posts and news this week from the MoneyBlogNetwork members and beyond: MightyBargainHunter asks if it’s time to sell your house and rent. Five Cent Nickel tells how to profit from 0% balance transfer credit card offers. Blueprint…

If we exclude everything after 1996, the past one-hundred years shows that housing isn’t a particularly good investment, and that it has a strong reversion to the mean inflation rate. I repeatedly hear people tell me “we bought this house for so-and-so in [year], and now it’s worth [amount]!” and when you do the math, even including the post-1996 boom, the annual real return is somewhere around 3-6%. Better than nothing, but, when risk-adjusted using that past one-hundred years, the return goes negative.

The critical point is: don’t rely on your house as an investment that will consistently appreciate. Don’t plan your finances around your home appreciating at 5-15% annually or you risk ruin in the future.

My own view of renting is that you should rent if you plan on moving in less than five years. If you buy a house, then move in five years, the miscellaneous costs and the fluctuations (even in good times) in value will likely wipe out any appreciation in value.

As traineeinvestor says, this is market timing. If it works, you’re a genius. If not, you’re skrewd.