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So how do you propose anyone ever buys a house, then? Waste money on rent whilst saving for 30 years so they can finally buy a house in cash at age 50? A modest

• Spivak 4y ago
  You’re either gonna be wasting money on rent or interest and interest rates are so bad you might be better off with rent. I found a 450k home near me on Zillow. If I put 20% down today with a 30 year mortgage, include property taxes, home owner’s insurance and the $100/mo hoa fee I will spend $550k in interest, $210k in property taxes, $30k in hoa fees and $60k in homeowners insurance or $850k of money that isn’t equity over the lifetime of the loan. My rent is $1400/mo in the same area. Let’s make it $2k to account for some inflation. I will spend $720k over 30 years and all my “equity” actually pays because it’s in the market and not my roof. But wait that’s not at all realistic. I want to own a house! If me and my partner can save 5k/mo (which is actually low since that mortgage was gonna cost us 3.7k a month and be at most 30% of our cash flow) we can buy cash in about 8 years. So we spend $192k in rent to get $450k of equity or we spend $550k to do the same. And this isn’t theoretical either. I’m two years and 130k into this process. I would be further but I had to eat a high six figure medical bill which thankfully didn’t financially ruin me and cost nothing setting my clock back. And if that isn’t the biggest endorsement of this strategy I don’t know what is.