On an economic level, it makes sense to own other assets and rent your primary residence if the discounted cash flow from the investments available for the pric

On an economic level, it makes sense to own other assets and rent your primary residence if the discounted cash flow from the investments available for the price of your home exceeds your rent. Typical returns on real-estate are about 3-4% (you pay the bank about that much to borrow the cash to buy a place, and if you own the place outright, you can make about that much in rent), but there's also the mortgage-interest tax-deduction, so it's equivalent to maybe 5.5% returns. The stock market typically gives about 7% returns, but with higher risk: if your risk-tolerance is high it makes sense to not spend money on a house but instead to invest it in stocks and use the cash spun off by that to pay your rent. (If your risk tolerance is very high, you can take out that mortgage, borrow the money for the house, and invest your savings in the stock market anyway.) On a pragmatic level, high-income people who rent often have jobs that require a large level of geographic flexibility to get their maximum salary. Think of your professional skillset & network as an asset that various companies can "rent" for different rates, depending on how much value it adds to them. Different companies will pay wildly different amounts for that; it doesn't make sense to buy if you get a 50% raise by moving to a different city (or just a different area of your metro region) but costs of selling your house eat up several months salaries.