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Renting isn't a short because you don't profit when the market goes down. And you are still out rent.
by trevelyan 11y ago
Renting isn't a short because you don't profit when the market goes down. And you are still out rent.
- rfrey 11y agoI think what was meant by the short was selling at current prices and holding the money, intending to buy back after a crash.
- kazinator 11y agoThe correct stock/equity analogy of renting is that you don't own shares of XYZ; you do volunteer work for XYZ. You pay XYZ regular dividends instead of the other way around, you maintain the equipment of XYZ and so on.
- mahyarm 11y agoIt isn't but it is a hedge. You put that down payment in some other asset class (stocks?), pay about half of what a mortgage would be currently and then profit when the RE asset bubble pops and buy when it's cheaper. And while your waiting the stocks themselves will probably have a gain of some sort.