You build 'equity' in a home only if you stay long enough... 5 years minimum? Depending on what price range you buy at. Otherwise, your home will probably depreciate as it ages. Besides, your closing costs and (eventually) listing costs will be well over $10,000 combined.
There's a neat calculator here for buy vs rent:
http://www.nytimes.com/interactive/b...alculator.html
I voted nice house. But IMO it depends on your house budget. A difference in ~$400 mortgage won't be dramatic in the $300,000+ range. If you're looking at ~$150k homes then yeah - IMO that money would be better placed in a house.