While I sometimes lament the troubles we’re having in getting our short sale offer moving toward a signed sales agreement, it’s easy to lose sight of the fact that the housing market is dramatically different than it was just a few years ago for long-time homeowners who may have been non-participants in the housing bubble back around 2005 or 2006.

This WSJ story provides more reasons why being long-time renters isn’t all that bad…

Record-low mortgage rates and a new slump in home prices are presenting unusual opportunities in the housing market these days—even for so-called underwater borrowers.

Some intrepid homeowners are intentionally taking a loss on their current house—and writing a big check to retire their old mortgage—in order to buy twice the home for not much more money. Others, eschewing conventional personal-finance advice, are even opting for “cash-in” refinancings, paying thousands of dollars out of pocket to settle old loans—and then taking out new mortgages with lower payments, shorter durations or both.

Katie Everett, a real-estate broker in Denver, says none of her clients kicked in cash when selling their homes last year. This year, “about half are willing to bring money to closing, anywhere from $5,000 to $45,000,” she says.

Are these people crazy to be tying up even more of their cash in their homes, in effect doubling down on what has been a losing bet thus far?

Uh… yes?

(more…)