I finally read a balanced report on the Rent Vs Buy decision at PFBlogs. It's certainly true that if you are young and single it might be smart to keep renting if you sock away the difference in an investment account. However, at some point most people marry and have children. I think that most people with children would deem it nearly a necessity to live in a home rather than live in an apartment. Besides the fact that people with children are sometimes discriminated against, the fact is that kids need space that an apartment won't provide. So if you are faced with renting a house once you have children, the buying decision should come as a no brainer.
The other part of the equation is buying retail Vs buying wholesale. If you are serious about being an investor, then your first big investment should be a home that you buy at wholesale prices. Most people hope to make money by buying a house and hoping it appreciates. Why not shop around for a desperate seller that will sell at a discount. This takes more time and patience and sometimes will take work if the house needs a lot of repairs. But this is ideal for a young single person or couple who spend their time on leisure activities. I've bought several homes now well below market value. Since there is little appreciation of houses here in Buffalo, its not been about buying at the right time.
So should you buy or rent? In my opinion, unless you are opposed to working for your money, buying is always the smart decision.