Assuming you have a basket of money and are simply undecided, renting is effectively a short on the housing market in your area between when you move in and when you move out. You're theoretically just saying that the expected proceeds from selling your house, plus net savings on rent vs cost of buying, minus a time premium, will be lower when you sell than when you buy If you plan to move in a year, transaction costs will likely eat your gains no matter what. If you plan to stay long enough, the time premium depends on how much you valuable the stability of living in one place with fixed/decreasing monthly costs vs what you expect to make in the market. Eventually, unless you have a huge pile of cash, you get old enough where that stability (so you don't have to keep grinding every month) is more important than chasing gains.
The only reasons why home ownership isn’t the single worst investment in the world (and honestly it still might be) is because you get some pretty sick tax breaks for it like the mortgage interest deduction and SALT deductions.
That and leverage (which is subsidized via cheap government mortgages). Real estate will always under-perform investing in the market because real estate is a lower risk asset. You sacrifice some gains in exchange for "not camping in the street" and also "not subject to some asshole called a 'lord' and paying him tribute". In practice, the whole point of "landlords" for the Capitalist class is to drive up the price of housing to force you to have to provide more labor - you have to provide V more dollars of labor a month than you would otherwise to pay for the landlord's profit, while you're boss makes V*(rate of exploitation) extra profits from you working that much more. It also drives up the value of land which theoretically allows them to take out more loans to invest more money based on the "value" of any property a company may own.
Assuming you have a basket of money and are simply undecided, renting is effectively a short on the housing market in your area between when you move in and when you move out. You’re theoretically just saying that the expected proceeds from selling your house, plus net savings on rent vs cost of buying, minus a time premium, will be lower when you sell than when you buy If you plan to move in a year, transaction costs will likely eat your gains no matter what.
Assuming you have a basket of money and are simply undecided, renting is effectively a short on the housing market in your area between when you move in and when you move out. You're theoretically just saying that the expected proceeds from selling your house, plus net savings on rent vs cost of buying, minus a time premium, will be lower when you sell than when you buy If you plan to move in a year, transaction costs will likely eat your gains no matter what. If you plan to stay long enough, the time premium depends on how much you valuable the stability of living in one place with fixed/decreasing monthly costs vs what you expect to make in the market. Eventually, unless you have a huge pile of cash, you get old enough where that stability (so you don't have to keep grinding every month) is more important than chasing gains.
That and leverage (which is subsidized via cheap government mortgages). Real estate will always under-perform investing in the market because real estate is a lower risk asset. You sacrifice some gains in exchange for "not camping in the street" and also "not subject to some asshole called a 'lord' and paying him tribute". In practice, the whole point of "landlords" for the Capitalist class is to drive up the price of housing to force you to have to provide more labor - you have to provide V more dollars of labor a month than you would otherwise to pay for the landlord's profit, while you're boss makes V*(rate of exploitation) extra profits from you working that much more. It also drives up the value of land which theoretically allows them to take out more loans to invest more money based on the "value" of any property a company may own.
:jesse-wtf: