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After you pay your loan off you no longer need to pay rent, and while you're paying your loan you don't pay rent. Author completely missed that point. You need

After you pay your loan off you no longer need to pay rent, and while you're paying your loan you don't pay rent. Author completely missed that point. You need significant income and housing depreciation to come out behind when you factor those two in. In fact for my situation, even if my house depreciates to 1/3rd what I paid I'll still be coming out ahead due to paying less than I ever did for rent.

njarboe 8y ago
If you want to move that 6% realtor cut is pretty nasty. A year or two of rent right there.
twiceaday 8y ago
You'd be coming out ahead compared to renting _and_ putting the house downpayment into a checking account, which nobody would ever do.
mrep 8y ago
You still need to pay property taxes though which are based on your properties value. The real benefit in my opinion is that it locks you into a permanent shelter price so that you can live someplace long term without getting priced out and if the value of your home skyrockets causing your variable price property taxes to skyrocket (california not included due to prop 13), you can sell it and make a bunch of money and then move somewhere cheaper.
closeparen 8y ago
After investing in equities for 30 years with the savings from renting vs. buying, you will also be sitting on a huge chunk of value.
- kuhhk 8y ago
  If I read that correctly, it sounds like you’re assuming that rent is lower than buying, which is not true in many places (including my own city). Many people buy rental properties because they can charge hundreds more dollars...
  - closeparen 8y ago
    Sure, that can happen, but probably encodes a pessimistic view about the area's future prospects. If my neighbors highly valued the option to flee, I'd want to be very careful about putting down roots.
  - mertd 8y ago
    Are they buying them with leverage (i.e. mortgage) though?
jnamaya 8y ago
I live in a high renting area where finding a decent 2 beds apartment for 2k is becoming almost impossible. I own a two beds family home in this area with an estimate price of $400,000 and I pay $1,700 in the mortgage every month. That comes down to $20,400 a year. Now the appreciation rate of a house in the US is about 5% every year. In a $400,000 home, that comes down to around $20,000 in appreciation every year. So in theory, I'm only spending $400 for my housing. After the recession in 2008 though, some houses have been appreciating at a rate of 20% or more.

njarboe 8y ago

If you want to move that 6% realtor cut is pretty nasty. A year or two of rent right there.

twiceaday 8y ago

You'd be coming out ahead compared to renting _and_ putting the house downpayment into a checking account, which nobody would ever do.

mrep 8y ago

You still need to pay property taxes though which are based on your properties value. The real benefit in my opinion is that it locks you into a permanent shelter price so that you can live someplace long term without getting priced out and if the value of your home skyrockets causing your variable price property taxes to skyrocket (california not included due to prop 13), you can sell it and make a bunch of money and then move somewhere cheaper.

closeparen 8y ago

After investing in equities for 30 years with the savings from renting vs. buying, you will also be sitting on a huge chunk of value.

kuhhk 8y ago
If I read that correctly, it sounds like you’re assuming that rent is lower than buying, which is not true in many places (including my own city). Many people buy rental properties because they can charge hundreds more dollars...
- closeparen 8y ago
  Sure, that can happen, but probably encodes a pessimistic view about the area's future prospects. If my neighbors highly valued the option to flee, I'd want to be very careful about putting down roots.
- mertd 8y ago
  Are they buying them with leverage (i.e. mortgage) though?

jnamaya 8y ago

I live in a high renting area where finding a decent 2 beds apartment for 2k is becoming almost impossible. I own a two beds family home in this area with an estimate price of $400,000 and I pay $1,700 in the mortgage every month. That comes down to $20,400 a year. Now the appreciation rate of a house in the US is about 5% every year. In a $400,000 home, that comes down to around $20,000 in appreciation every year. So in theory, I'm only spending $400 for my housing. After the recession in 2008 though, some houses have been appreciating at a rate of 20% or more.