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> The numbers still pencil out on average. You're going to need to show your work here, because, to me and apparently to several other posters at least, it mak

by pdonis 3y ago

> The numbers still pencil out on average. You're going to need to show your work here, because, to me and apparently to several other posters at least, it makes no sense to even compare the numbers in the two cases you describe, because, as another poster responding to you said, you can't live in your stock portfolio. > renting... Renting the place you live in vs. owning it is not the comparison you are claiming to make when you say buying a house and living in it is a "bad investment". The comparison you are claiming to make is between buying a house and living in it, vs. buying a house and renting it out. Which, as noted above, doesn't even make sense as a comparison.

jandrewrogers 3y ago
The comparison is renting versus buying the same place to live in. A common fallacy is assuming that the financial loss from renting is always larger than the financial loss from buying. I gave a concrete example of why your pure losses owning that place would be thousands of dollars higher than the pure losses from renting the same place. I didn't say being a landlord had a good return on investment, just that landlords can make a profit charging a rent below your cost to buy. As a consequence, if you invest the difference reasonably then your net worth can grow faster as a renter. To put it another way, you could rent and save enough money to buy the house with cash before you'd be able to pay off your mortgage, ceteris paribus. You'd still have the house at the end. Financial models that show you often come out ahead if you rent and put the difference in other investments have been done ad nauseam on the Internet, it doesn't need to be rehashed here.
- pdonis 3y ago
  > The comparison is renting versus buying the same place to live in. Not the comparison I and others have been responding to. That was talking about buying a house and renting it out instead of living in it.

by pdonis 3y ago

jandrewrogers 3y ago

The comparison is renting versus buying the same place to live in. A common fallacy is assuming that the financial loss from renting is always larger than the financial loss from buying. I gave a concrete example of why your pure losses owning that place would be thousands of dollars higher than the pure losses from renting the same place. I didn't say being a landlord had a good return on investment, just that landlords can make a profit charging a rent below your cost to buy. As a consequence, if you invest the difference reasonably then your net worth can grow faster as a renter. To put it another way, you could rent and save enough money to buy the house with cash before you'd be able to pay off your mortgage, ceteris paribus. You'd still have the house at the end. Financial models that show you often come out ahead if you rent and put the difference in other investments have been done ad nauseam on the Internet, it doesn't need to be rehashed here.

pdonis 3y ago
> The comparison is renting versus buying the same place to live in. Not the comparison I and others have been responding to. That was talking about buying a house and renting it out instead of living in it.