what my husband and i did is exactly what your wife wants to do. honestly, i think renting is throwing your money away. it's going towards paying someone else's mortgage, it's not benefiting you in any way. if youre going to rent for just a year, why not go ahead and buy a house?
insurance isnt much at all. it's like on average $50 a month depending on what kind of coverage you get. my husband and i made a grand total of 26,000 last year. we have 2 car payments, their insurances, a harley davidson, medical bills, everything under the sun it seems like. we've got enough cash to throw into savings every month and have every single bill paid on time, no struggles. homeowning and having a baby isnt going to put you in the hole.
i dont know where you live, but here in north carolina we bought a beautiful 3 bedroom 2 bath home for 94,000. our mortgage is 718.00 a month at a 6.25% interest. we didnt put ANYTHING down..i mean nothing. you dont HAVE to put a down payment on a home. you can also add any and all closing costs to the entire amount of your mortgage...there is no rule saying you must make a down payment or pay anything up front. we bought our house for 79,000 but with all the extra costs it came to 94. 718.00 a month isnt bad at all for 3 bedroom 2 bath open floorplan 1 car garage.
my opinion, buy a home now. renting doesnt financially benefit you in any way. plus its someone else's home you're living in, you wont be able to do the things you'd like to do to it. buying a home is an investment, if you do it right, it'll take you places, and with a baby that's a plus.