If you have £100k of equity/capital in your house then on average (long term historical index investment) you would have made £864k investing over 20 years vs a

If you have £100k of equity/capital in your house then on average (long term historical index investment) you would have made £864k investing over 20 years vs a historical average of £165k in a property. (Here's a source for the 12% figure - http://www.finfacts.ie/stockperf.htm http://www.finfacts.ie/stockperf.htm ) The money your borrow from a bank can (depending on relative cost) close or open the gap. If average return is 5% and the average cost of borrowing is 2% (over 20 years) then you would make an additional £80k per hundred thousand borrowed. However if the average mortgage rate is 8% then you would lose an additional £80k per hundred thousand borrowed. Capital growth will also add something - over the last 20 years it was about 100k per 100k invested/borrowed. 2% and 8% are both well within the historical mortgage rate trends. Renting helps reduce your exposure to this, whilst increasing your exposure elsewhere. All calculations are pre-inflation.