4 ms·

Hasn't been the case for you, and arguably for a lot of people, but not for everyone. Everyone has to run the numbers and do their own calculus. Buying being

Hasn't been the case for you, and arguably for a lot of people, but not for everyone. Everyone has to run the numbers and do their own calculus. Buying being better than renting is a good rule of thumb but it has some glaring exceptions.

bluGill 3y ago
The best rule of thumb is buying or renting will turn out about the same in the long run if you invest the difference saved by renting. Buy buying your up front payments are higher than renting, but you pay the house off and long term pay less and thus need less to live on. Renting you have more free cash up front, but you need more cash in the long run. The above is the rule of thumb though. You have to run numbers for your life situation as they constantly change. Note that some of the numbers are for your life situation which itself can change. Renting is often better just if you buy and have to move there is a bunch of negatives.
- jjav 3y ago
  > The best rule of thumb is buying or renting will turn out about the same in the long run if you invest the difference saved by renting. Owning a home, I'm investing the difference I save by not having to rent. Difficult to see how a renter can come ahead unless the time horizon is just a couple years. Rents only ever (mostly) go up. Mortgages only go down (refinances). Those lines can cross in just a few years into ownership. By now, renting the same house I own is about 4x more expensive. One thing you really don't want when going into retirement is a constantly and unpredictably increasing housing cost when you'll be on a fixed income.
  - bluGill 3y ago
    There is more than just house payments. There is also taxes and insurance, both of which go up over time (they are often rolled into the mortgage payment, but they are not the same thing). There are also maintenance costs which can be quite high (if you do it yourself they can be lower, but not everyone has the time or ability). Also most people are buying a much larger place than they would rent. These need to be factored in and they make the point where the line crosses farther out.

bluGill 3y ago

The best rule of thumb is buying or renting will turn out about the same in the long run if you invest the difference saved by renting. Buy buying your up front payments are higher than renting, but you pay the house off and long term pay less and thus need less to live on. Renting you have more free cash up front, but you need more cash in the long run. The above is the rule of thumb though. You have to run numbers for your life situation as they constantly change. Note that some of the numbers are for your life situation which itself can change. Renting is often better just if you buy and have to move there is a bunch of negatives.

jjav 3y ago
> The best rule of thumb is buying or renting will turn out about the same in the long run if you invest the difference saved by renting. Owning a home, I'm investing the difference I save by not having to rent. Difficult to see how a renter can come ahead unless the time horizon is just a couple years. Rents only ever (mostly) go up. Mortgages only go down (refinances). Those lines can cross in just a few years into ownership. By now, renting the same house I own is about 4x more expensive. One thing you really don't want when going into retirement is a constantly and unpredictably increasing housing cost when you'll be on a fixed income.
- bluGill 3y ago
  There is more than just house payments. There is also taxes and insurance, both of which go up over time (they are often rolled into the mortgage payment, but they are not the same thing). There are also maintenance costs which can be quite high (if you do it yourself they can be lower, but not everyone has the time or ability). Also most people are buying a much larger place than they would rent. These need to be factored in and they make the point where the line crosses farther out.