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My thoughts on renting versus buying
- streetcat1 1y agoYou forgot the tax advantage and the protection against inflation (if you have to fix rate mortatge).
- brewdad 1y agoThe tax advantage is only available for people that itemize. Only about 10% of taxpayers do so. Inflation protection is very real and important though.
- benregenspan 1y agoI think he covered these by his mention of "spreadsheets". A good spreadsheet for rent-vs-buy would include the values in the sliders seen on https://www.nytimes.com/interactive/2024/upshot/buy-rent-calculator.html https://www.nytimes.com/interactive/2024/upshot/buy-rent-cal...
- milesbarr 1y agoExactly. The tax advantages are tangential to the behavioral factors I mentioned.
- FpUser 1y agoI am a home owner since 1998 I think that none of you arguments against owning make sense to me. To me your writing reads like following: due to the world gone crazy I can no longer afford to buy house so let's concoct some soul soothing reason and pretend that all is fine.
- foobarian 1y agoYes and how about also people in older generations who are done paying off mortgages and now live paying just the real estate tax.
- Simulacra 1y agoBecause they purchased. And they stayed there. I think people forget that boomers bought their houses 20 30, 40 years ago, and they stayed there. It's not like they bought it 10 years ago and all of a sudden it went up dramatically. I don't think a lot of people consider that longer timeline, it's just easier to blame "boomers."
- prasadjoglekar 1y agoAnd maintained it. The house didn't just get better over 30 years. A lot of weekends were spent painting and mending things.
- ghaff 1y agoI assure you I pay a lot more than just the real estate tax (and insurance). There's a ton of maintenance in general. Even with insurance, I was just out a good $50K with a middle of the night kitchen fire.
- eweise 1y agoAll I know is my mortgage is $1,800 a month and to rent my place now is at least $6K/month. I love knowing that my monthly payment can't go up.
- bthrn 1y agoProperty taxes and insurance go up pretty much every year.
- toomuchtodo 1y agoNot faster than rent. You can always challenge your property taxes and shop your homeowners insurance. If your rent goes up, you can only move, which isn’t really an option when all landlords are raising rents in lockstep. Half of American renters are cost burdened, for example. https://news.ycombinator.com/item?id=43119657 https://news.ycombinator.com/item?id=43119657 (own my primary US residence free and clear, my housing savings goes into investments, which grow faster than inflation)
- slumpt_ 1y agoi guess it will depend a lot on where you bought some parts of california have been affected by insurers more than others, but in those more minimally affected? prop tax is suppressed via prop 13 (for better or worse), and the cost of insurance is a drop in the bucket relative to what id be paying for a roof over my head otherwise tbh
- campnic 1y agoWhich has the exact same impact on rental properties. In many jurisdictions it is worse for rentals (no homestead or occupancy reductions)
- grues-dinner 1y agoPresumably those go up roughly the same for rental properties as well. So while your payments may still go up, you're paying it either way on top of interest/rent.
- al_borland 1y ago
- kennywinker 1y agoIf renting doesn’t make sense economically, how is it profitable for the landlord? Because it’s almost always profitable for the landlord.
- Simulacra 1y agoBecause of the price, and the market willing to pay that price. If nobody was willing to pay $2500 for an apartment, nobody would rent it, and the landlord wouldn't have any money. For one person that can't afford a place, there are 10 who can. So landlords quite naturally match the market demand.
- kennywinker 1y agoIn theory rental prices are just the market price. In reality there is a very high pressure on the price to be above whatever the landlord’s mortgage is. I understand why, but i’d still rather pay my mortgage than my landlord’s.
- Panzer04 1y agoLandlords who rent at their cost and not the market price won't rent. I don't see how your statement follows at all. I'm sure landlords would prefer rents to be higher than their mortgage but that will be determined by supply and demand, not their desires. The housing market is huge, with lots of alternatives and competition, so you can't exactly price fix it either.
- kennywinker 1y agoYou can choose to not see it, and I can struggle to explain it, but i dare you to find a landlord in a city larger than 100k who is renting at a loss. I suspect it’s some kind of uncoordinated price fixing. E.g. 1. landlord buys property, optimistically sets rent at $mortgage+30% even tho that’s above the market rate 2. Everything cheaper is rented, or highly sought after, so renters are forced to take the higher rent. 3. Other landlords see places renting for higher than their current rent, and raise prices accordingly. But i’m no economist. I’ve just never seen a landlord take a loss except as a result of special circumstances. Economic crashes, fire, etc.
- cschep 1y agoThere used to be a world where you could get INTO the investment with almost free money. You can't get a 2% loan and dump it into the stock market. Well you can't do either anymore but you used to be able to :)
- matthewfcarlson 1y agoI think a better take away from this article is that if you aren’t buying your home like an investment (looking at cash flow and prioritizing financial outcome over all other factors such as distance to work or functionality), then you shouldn’t consider your home one. You’re paying for a place to live and if it happens to be financially sound, great. Otherwise you need to accept that you might lose money on it. Somehow this has been normalized for cars but not homes.
- Simulacra 1y agoMy mortgage is $1900 a month and I am extremely grateful for that, because it's been that for three years. I chose to buy so that I could have more predictability in my housing costs, and maybe someday I'll move, but then I'll rent it out. All that to say, if you can buying is infinitely better.
- kibwen 1y ago> The Flexibility of Renting Is Undervalued And the stability of buying is undervalued. It's telling that this article frames housing as an investment vehicle rather than as a basic necessity. And it's not just a necessity because it shelters you from the elements and gives you storage for your stuff; it anchors you in a neighborhood and allows you to begin forming a local community. The flexibility of renting that this article glorifies is itself anathema to knowing and befriending your neighbors on anything but the shortest of terms; even if you don't intend to move, you have no guarantee that they won't up and exercise that flexibility. This is a major contributor to the modern loneliness epidemic.
- pedalpete 1y agoAs a renter who has recently been given notice that I must vacate my apartment in 90 days, you'd think I'd agree with you. However, I think this depends highly on the personality of the renter/owner, and that is the point this article misses. If someone is, like myself, comfortable with risks, I'm ok with changing neighbors, locations, and I've lived on 3 different continents and 9 cities? If you're someone who craves stability, then this isn't for you, and you're proably better off buying a house.
- onecommentman 1y agoValues stability. You crave an addictive substance. By choosing the word “crave”, it sounds like you are pathologizing the choice to buy a home, perhaps from a need to validate your personal life choice to rent in spite of facing a forced vacation of your residence. Or perhaps you have financial interests in real estate companies that manage apartments.
- pedalpete 1y agoI think that's somewhat appropriate. I live in Australia where buying a home does seem more of a pathology than a smart economic choice.
- const_cast 1y agoHomes are not low-risk or stable at all - you transfer the risk to your job. If you lose your employment and you have a home, that's a much riskier situation than if you're renting. Because, if you cant find a job in time or in a very small location radius, you must sell. The mobility of renting lowers the risk associated with extraordinary life events which requires relocation.
- rda2 1y agoPretty lacking in math for an article that mentions math a few times. I looked into this a few years ago when I was trying to see if we were really in the worst housing market ever, and came to the opposite conclusion. https://arriens.us/articles/housing.html https://arriens.us/articles/housing.html
- deleted 1y ago[deleted]
- pjmv 1y agoThe argument the author makes about the returns in stocks being higher than returns in real estate does not really hold when taking leverage into account. In my country, buying a home is the only way to get cheap debt for the vast majority of people.
- zahlman 1y ago> does not really hold when taking leverage into account. Detailed analyses exist, e.g. https://www.youtube.com/watch?v=j4H9LL7A-nQ https://www.youtube.com/watch?v=j4H9LL7A-nQ .
- HardCodedBias 1y agoBen is fantastic. As Ben notes the tax advantaged status of primary homes has more capacity than most tax sheltered alternatives. But a lot of this depends upon income. This reminds me, I need to buy more DFA. :)
- __turbobrew__ 1y agoWhere do you buy DFA from? Here in Canada I think you can only buy it through brokers? I want to buy some small/medium CAP ETFs but there is nothing really in Canada you can buy off the TSX.
- zahlman 1y ago(This is not investment advice) Several companies (including major ones like Blackrock, and TD Bank) offer US equity ETFs denominated in CAD available for purchase by Canadians. This includes some basic sector and factor options, and even some leveraged and other derivative ETFs (but expect MER >1% on these). Your bank can most likely set you up with a "direct investing" or similarly named option (after doing some KYC stuff of course) that allows you to buy ETFs directly in a TFSA or RRSP. Or you can try a third-party service like Questrade, WealthSimple etc. It's even possible to hold options in a TFSA if you have the right paperwork, as long as you don't give the CRA the impression that you're making a "business" out of "day trading". Once you're set up it should be easy to find "some small/medium cap ETFs", for both Canadian and American (and maybe international) holdings. tl;dr: talk to someone at your bank. Make sure it's clear you aren't looking for investment advice and want to make the decisions yourself. Or look up those third parties. (If you hold registered accounts at multiple institutions, to my understanding you will be held fully responsible for observing a total contribution limit etc. across all of them.)
- firtoz 1y agoIt's interesting to paint the homeowner as an emotional person and the renter as the pragmatic, however both are roughly equally emotional. As the rent prices keep rising, the renter in the end will end up spending much more money in the same duration as a mortgage, won't they? After a few years, when they end up owning more of the property, they can secure a good deal with better monthly mortgage payments. They can also quite easily set up an AirBnB or get proper renters, if they want to have some flexibility, and in most cases the rent money will be more than the mortgage payments, so if they want to rent another place of their liking, the additional income will offset the monthly costs.
- sidrag22 1y agoits a unique math problem for the individual, but if you ARE buying, that likely means you have a down payment. so if you rent instead, you can then utilize that down payment for other investment opportunities. this touches on something the author sorta hinted at, mortgage as a forced investment. Some buyers/renters won't view the down payment as an investment opportunity if they go the path of renting, they decide to rent and suddenly theyve got a new car loan and all new furniture or whatever, and that down payment is gone, instead of compounding year over year in an attempt to make renting a financial advantage you can usually napkin math investing the down payment and it makes more financial sense to rent, but from a human perspective its just not gonna happen like that for so many people. they are gonna mess with that money instead.
- novaRom 1y agoHow about the act of buying itself? Here where I live, you need to pay 12% on top of the home price simply for taxes and notary service. IMO it's one of the biggest obstacles and why most Swiss people prefer to rent.
- jfim 1y agoSwitzerland is a bit different from the US. From what I understand, property ownership entails paying the imputed rental value in taxes, which makes property ownership much less desirable. In the US, mortgage interest is tax deductible up to a certain limit, property taxes are deductible, and there's an amount of capital gains that's excluded from taxation when selling one's primary residence. Compared to other places in the world, the benefits of property ownership are pretty bonkers.
- mold_aid 1y ago[dead]
- zahlman 1y ago> People Tend to Overbuy Any "house" would be too big for me by myself. And buying a condo apartment seems like a strange proposition to me; compared to renting the same space, it seems like just paying extra in order to accumulate some nebulous equity at the end of the term. I'd rather do that with more liquid asset classes.
- gxs 1y agoImagine two things being able to be true at the same time That sometimes under the right circumstances a home is both a great place to live, the best deal you can get in your area, and also an investment You sort of alluded to it in your post, but it’s different for everyone, but then you go on ahead and speak as if there were one answer Good for you you chose to rent - you don’t have to deny homes potentially being good investments to validate your decision
- CSSer 1y agoThe framing makes it seem as if valuing stability is somehow inferior while elevating financial growth. This makes me think our financial and housing systems have become so distorted that it has infected our thinking. Adult humans are often super resilient, but kids aren't. Moreover, even adults have limits. I don't want to live in a system filled with chaos just because it makes some intangible number go up. We're all going to die one day. What will we leave behind, material or otherwise? Stability seems very underrated.
- barchar 1y agoThe stability comes from the wealth, not the house.
- kleinsch 1y agoHome prices have dramatically exceeded inflation for a long time, so you're getting advice from people who reaped huge appreciation gains. Now housing prices are hitting affordability limits, interest rates are less appealing, so it's unclear if the future will look like the past.
- saulpw 1y agoInterest rates for home-ownership are a ratchet, though. If they ever go down (and they do fluctuate over the course of decades), and you are financially stable (this may or may not be the case at the right time) you can generally refinance to lock-in the lower rate.
- __turbobrew__ 1y agoThat only applies to mortgages in the US for the most part. Everywhere else you only finance for 3-5 years at a time.
- creakingstairs 1y agoMy spouse and I quite like where I am now, but I don't want to buy something here due to rates, insurance and future potential of the city. So, I've pretty much settled on buying something small in another city and renting it out while we rent here. I think this might be a good balance to get us some type of flexibility while also diversifying our assets. But now the problem is trying to find a decent rental property in another city :p
- andy99 1y agoThis is written from the perspective of someone who doesnt have kids or other ties that reduce flexibility (and from that perspective I agree a house is a huge liability in term of being able to make big life changes). It also sucks if you have neighbors you can't stand. The main advantage of a house imo is that you can't typically rent something comparable, at least where I've lived. The rental market for 4 bedroom houses is tiny compared to the number for sale.
- milesbarr 1y agoFully agree on this. If you have kids, stability is important so that can be a good reason to buy, regardless of whether it's an optimal financial decision.
- rob_c 1y agoIn what possible scenario is burning cash vs keeping a fraction of it a bad financial decision? I can only imagine it makes financial sense to rent if you live somewhere where you're not paying off someone else's mortgage and are paying a fair renting price. (Otherwise paying your own mortgage just makes more sense) As an actual honest question, where in the world is like that any more?
- dnissley 1y agoIn most HCOL cities it's cheaper to rent than to buy
- rob_c 1y agonot in the UK. Which is why I asked. I can name 4 cities easily where you're paying mortgage+extra driven by the "buy-to-let" craze over here. I'll assume you mean the UK is a phenomena in that case.
- dbish 1y agoI think the difference for the UK is it’s HCOL but low pay, so people there can’t afford the mortgage down payment as much, which is not normal for say American HCOL cities.
- yrcyrc 1y agoBeing 47 and still renting I think the piece missed a big issue, which is most prevalent these days: we cannot afford to buy. Anything. Anywhere. I reckon I’m fatally doomed to renting.
- latchkey 1y agoI travel around the US and Canada in my campervan and I've noticed that it feels like a lot more people live in RV's now, which enables you to buy something and park it nearly anywhere (location wise) that you can find space. There are RV parks all over. Depending on where you decide to be, it probably isn't a bad solution and worth considering if you do want to own something, but don't want or can't commit to a whole house.
- ndriscoll 1y agoMedian first time home buyer is 35. Median first child birth age is 27. Most people buying their first home aren't looking for the flexibility to move every year.
- edmundsauto 1y agoThis is one persons opinions on their own situation. It’s written too broadly, but does a reasonable job representing one side of the tradeoffs that people should consider. It is not particularly balanced or overly insightful for anyone who has spent much time thinking this stuff through, and a lot of statements that could be backed by data are not and are simply asserted as fact. (For example, the idea that renters are more likely to pursue promotions is a very non-serious argument unless backed with some actual data) If this had been framed differently, it would be more interesting. Instead it comes across as universal (“most people won’t saved unless forced to”) and ignores the many many benefits of buying. (Not mentioning 5x leverage on a historically good asset is willful ignorance) As a former renter of 20 years, these are great points that everyone should evaluate. As someone for whom home ownership made sense now, I wish I had been able to prioritize those factors earlier as it would have been nice to have my mortgage locked in at 2010 prices.
- bongodongobob 1y agoRenting is more expensive and you are just burning money vs building equity. This article is ridiculous.
- gdulli 1y agoHow long is a piece of string?
- bongodongobob 1y ago1
- zamalek 1y agoThere is one unmentioned far future benefit: if you pay your mortgage off before retirement you'll probably enjoy more shelter security than your peers. Rent is a monthly cost (eating into your retirement) that could skyrocket (which your retirement plans may not have accounted for). Of course, a solid investment plan may offset these - but only a domicile (doesn't need to be a house) would survive everything related to the economy going to utter hell. I agree about houses, though. A saner plan may be to purchase a modest apartment or the like, that you keep in the wings until you reach retirement.
- arnonejoe 1y agoI have owned a few homes over the years and have also had many landlords. The house we rented in Lafayette, Ca in 2010 was in a nice hood. At the time it was 2 years past the financial crisis and homeownership was not something I wanted to do for a while. The land lady we rented from wanted to sell the house for 650k. That house is now 4.3 million on zillow. Granted it has since had a renovation and an addition, but still. We also rented a townhouse in Encinitas, Ca. The rent was 3k a month in 2017 and now a similar townhouse in the same complex is renting out for 6500. The problem with renting is that eventually you get priced out of the nicer hoods. The problem with not buying a house when a deal shows up in a decent hood is that eventually that hood will never be affordable to mere mortals again. Maybe these rules only apply to California.
- themafia 1y agoI took the middle way. I bought an RV and I rent the space I keep it in. I can move to a new park if I want and there are several counties where you can live in an RV while building a home or you can just permanently live in an RV. I get good flexibility and value for my dollar. The savings over renting is insane.
- stavros 1y agoAs someone who's both renting and has bought (renting my main flat and bought a summer flat), I think I prefer buying. I'm always living in fear of being told I have to leave, and the flexibility is overrated because everyone I've talked to tends to just like where they happened to live. Everyone generally finds the positives of their current area to be the positives they really like, and the negatives manageable. This means that, generally, no matter where you buy, you won't want to have bought anywhere else after a few years. There are cases where you might hate it, of course, but you could still sell/rent to someone else and buy/rent elsewhere.
- dbish 1y agoI can say I'm very much on the other side now after owning (and unfortunately still owning) a townhome that I used to love living in but now can't seem to get rid of in Seattle while I rent across the country. I moved for work and really wish I had been renting since I do not want the hassle of being a landlord, but Seattle townhome sales have slowed to a crawl as the city never really recovered after covid. If you get unlucky with no reason to still be in a particular city and that city starts a downward swing, there's no gaurantee it ever comes back and you're stuck taking care of something that you might never be able to sell for anything but a loss. I will likely stay a renter and keep that flexibility in my new city for a long time after this experience.
- Sleaker 1y agoThis article seems to present surface level arguments that aren't entirely fleshed out very well. Ex: what is the actual emotional impact of renting vs buying as that seems like it is the core underlying argument being made. I think the argument presented is dubious specifically because rents are a non fixed cost and provide no direct guaranteed long term benefit. Even as someone that purchased in 2021 with a price locked in from 2020, rents in my area are now equivalent or higher and it only took 2 years for the rent to catch up!. The graph tells the story that others are pointing out: https://www.realpage.com/storage/files/blog/posts/images/2025/02/mp-vs-ar-021725.png https://www.realpage.com/storage/files/blog/posts/images/202...
- moooo99 1y agoFirst of all, I fundamentally disagree on the notion that buying a home should be considered an investment (I would go as far as to argue that this attitude is part of the reason the real estate markets are so broken in many places of the world). I don't want to be rich and I don't need to be - I just want a place where my kids some day can grow up, where I can enjoy the sun in the garden and invite family and friends over to spend a nice evening. I do not care about the financial aspect of it beyond "can I afford this without overstretching and putting my family into financial danger". From a purely financial perspective, I think you could say: the more protections you as a renter receive, the more renting makes sense. Living in Germany, I do have quite a few protections as a renter. My landlord can't arbitrarily hike prices, etc. In my current city, it would be absolutely impossible to get a mortgage anywhere close to my current monthly rent (even with substantial equity)
- Gibbon1 1y agoWhen I bought me house what I eventually decided is you can't use ordinary financial metrics for owner occupied housing. The reason is buying a house on credit is essentially the only investment you can make with the money you have available for housing. My opinion is the issue with renting and housing in general is the world wide financialization of real estate. It's being treated as a primary investment instead of the secondary investment it is. Some fraction of people are getting exceedingly wealthy but there are deep negative effects. My bet is the crashing fertility rates are likely what's going to put a stop to it. Notable every 15-20 years we have a bigger than the previous financial crisis. Once populations start to decline the bottom will fall out.
- ponector 1y ago>> My bet is the crashing fertility rates are likely what's going to put a stop to it. Crushing fertility rates will not drive real estate prices down. It will create ghost cities, but business centers or any other desirable to live place will have high prices, maybe even higher as people are going to escape from dying towns.
- malshe 1y ago
- jvanderbot 1y agoWhen my computer was getting too loud, I took a drill, made a hole to the closet, and moved it in there and ran the cables through the hole. When I didn't like mowing the hill behind my house, I had a retaining wall put in. Also preserving the elevated deck. When I found i didn't like the elevated deck, I build a new ground level one with my father in law. I'm not sure I like entering into the kitchen so I'll probably put a door into the porch instead. I'm not saying I couldn't just rent a new place to find better digs. But I hate moving, hate shopping for new houses, love this yard and house in general, and am not paying more month to month than I was when renting (and get much more space for the dollar). I don't want this place to make me rich, in the above you might get a sense that I already feel content. That's my decision criteria and I don't know why that's incorrect. You don't have to run a household like an investment company.
- cloverich 1y agoThe key is to make that decision based on your preferences, and not simply by going with the generic advice to buy a home from a purely financial perspective. Many people do this (take the generic advice). Many people in this comments section by their own declaration (explicit or implicit) haven't done the math. It's really kind of shocking, at least to me it was. I was stressed we could not afford a home in our area, then I did the math and realized by renting, I'd come out _very_ far head. For me it's not about wealth but financial independence and stability. At our current earnings and rent, if we continue renting, and I were to lose my job, I could cover our expenses in our area _for years_ (even if our rent increases 50%). If we buy, I'd need to sell within 6-12 months and if the home had dropped in value (like, at all), I'd be potentially underwater. So the bit that sounds more stable (buy the home) can easily be less so, and in practice _is_ less so for many people. While I would absolutely love to purchase a home (for your reasons), the reality is I have more stability for my family (particularly my kids / school) by renting for at least the next 5 years, but very likely throughout their school.
- gedy 1y agoI don't disagree with the his points, however: "The flexibility of renting has major financial advantages" Like 80% of my motivation to make money in past was: to buy a house. I have no interest in FIRE and be a couch surfing digital nomad around the world or whatever. So it's hard for me to be motivated by the financial aspect if the end result was no house for now basically.
- encoderer 1y agoAll else being equal, a house is too personal a thing for me to rent. It would be like renting a complete set of clothes. I don’t want to be a real estate developer writ large, but I do want to develop my own space and optimize it for my family as it grows and changes over time.
- milesbarr 1y agoThat's fair. I was mainly trying to push back against the idea that owning a home is always a good investment. There are definitely other major advantages to owning a home.
- isaacremuant 1y agoThis is just propaganda to push people to cope and be part of a renter class that gets screwed over by a homeowner class. No, don't be emotional, don't buy your own place and have stability. Own nothing and be happy! Let the corporations own everything and have "flexibility (TM)"
- dcre 1y agoIn my experience there is a real difference between the places available to rent and to buy. It is not an idealized single good with a spectrum of prices that line up cleanly with quality.
- al_borland 1y agoThe prevalence of luxury apartments flies in the face of the overbuying section. People overbuy on apartments as well. Every time I see someone arguing about minimum wage, their benchmark seems to be having a 2 bedroom apartment, not a studio or even a 1 bedroom. I find this wildly unrealistic. Apartments also sell people on amenities that almost no one uses, but justify higher rent prices. These luxury apartments are used in the same way people use their over-bought homes. It’s a way to buy into a different class of neighbors, feel like you’re not sacrificing with a rental, signal to others that you’re doing well, ideally have better management/maintenance, and live in a place that out-classes the home they may otherwise buy… all with no maintenance or investment. I’ve seen some crazy rent prices. I’m not sure who is renting these places, but someone must be, because they keep building them. I prefer renting, but I ended up buying a house because rent prices starting going up beyond what I felt with reasonable.
- strls 1y agoWhere I live, any rental building from this century will be marketed as luxury. There is in fact absolutely nothing luxury about them. Everything is cheap and crummy, just not too dirty/smelly/with rats (yet). Rents are 5-7k for a 2b and being luxury or having amenities have nothing to do with this. Supply and demand do. There are enough people who make this kind of money and value living in a place that is half-decent + easily commutable to the city more than the 6k.
- bnchrch 1y agoI've seen these critiques for years. and while its not necessarily wrong, I believe it under weights a few points: - Fixing your housing costs against inflation: You can't count on housing price increases, but you can count on inflation. If you buy a house and your mortgage payment is > rent. Overtime it will naturally flip. $1 no longer buys me a chocolate bar, and $800/month no longer gets me a 2 bed apartment. - Leverage: I can't get a $700k loan to put into equities but I can for a home. - Capital Battery: As I build equity in my home it can become an asset I take loans against to pursue other opportunities. - Flexibility: Should I need to fiscally downsize I can still move out and rent out. Or rent a portion either via a suite or secondary unit - Stability: No one can evict me into a hot rental market to suit their needs. I wish more people talked about these points, selfishly so I didnt take so many of these articles at face value because in hindsight I wouldve bought earlier.
- dbish 1y agoYou're not taking into account that housing prices can fall, not just stay flat and there are always things to fix and deal with in a house that you own. Renting it out is also not always gauranteed or easy if you are not nearby or don't want to deal with being a landlord, so imho that flexibility is not really there in many cases.
- al_borland 1y ago> No one can evict me into a hot rental market to suit their needs. The bank can, if you take out too many loans against your house that you can’t pay back. When you barrow against your house you’re increasing your risk. “Rational people don’t risk what they have and need for what they don’t have and don’t need.” - Warren Buffett My house is paid off now and I can’t think of anything that would make me barrow against it. Setting aside variable maintenance costs, with only having to worry about property taxes now, I could work at Costco and make ends meet now. That gives me some peace of mind against an uncertain job market. A loan against the house would change that equation wildly.
- 9x39 1y agoIt’s true over leveraging seems to be the American way, but GP was saying, I think, that homeownership does not have the risk of a landlord ending an otherwise mutually accepted relationship. If this is still accurate, a third of renters could theoretically be told the rent is doubling or learning the lease is ending. Depending on the health of the market, that can be a major risk, and not everyone can or wants the flexibility of a rental at all times. https://www.bls.gov/spotlight/2022/housing-leases-in-the-u-s-rental-market/ https://www.bls.gov/spotlight/2022/housing-leases-in-the-u-s...
- jcims 1y agoThe home buying process seems to have been thoroughly corrupted, at least in the US. The transaction costs are high, parasitic HOAs and paying over ask have been normalized, new homes are built as cheaply as possible, investors are driving up costs, etc. etc. The investment aspect is a bit overrated. You can't get that money 'back' because you still need a place to live. Most folks just flip their equity into the next place, so it never really comes back to them until they downsize or die. I've been a homeowner for 30 years and am now renting a temporary apartment in a new location. There's a lot of upside of renting. I don't like apartment living at all, but I don't feel anchored to the location at all and have the freedom to live wherever without a bunch of overhead. I'm definitely spending more money per square foot renting, and obviously none of this is coming back to myself or my family, but that's ok for me right now. I think my main takeaway is that there is no rule about what is best. It's what's right for you at that time of your life. A house is nice when you have kids and want some stability. Renting is nice when you want freedom and flexibility.
- ForHackernews 1y agoReminds me of https://jlcollinsnh.com/2023/03/02/why-your-house-is-a-terrible-investment/ https://jlcollinsnh.com/2023/03/02/why-your-house-is-a-terri... “Hey I’ve got an idea. We’re always talking about good investments. What if we came up with the worst possible investment we can construct? What might that look like?” Well, let’s see now (pulling out our lined yellow pad), let’s make a list. To be really terrible: - It should be not just an initial, but if we do it right, a relentlessly ongoing drain on the cash reserves of the owner. - It should be illiquid. We’ll make it something that takes weeks, no – wait – even better, months of time and effort to buy or sell. - It should be expensive to buy and sell. We’ll add very high transaction costs. Let’s say 5% commissions on the deal, coming and going. - It should be complex to buy or sell. That way we can ladle on lots of extra fees and reports and documents we can charge for. - It should generate low returns. Certainly no more than the inflation rate. Maybe a bit less. - It should be leveraged! Oh, oh this one is great! This is how we’ll get people to swallow those low returns! If the price goes up a little bit, leverage will magnify this and people will convince themselves it’s actually a good investment! Nah, don’t worry about it. Most will never even consider that leverage is also very high risk and could just as easily wipe them out."
- freshtake 1y agoThe TL;DR is that the value of renting vs. buying has a lot to do with being realistic and understanding real estate and investments in general. Buying a house is often an emotionally motivated decision with many important risk factors... Were inspections comprehensive and thorough or did they overlook an issue with the foundation, wiring, plumbing, etc.? Did the buyer understand the required disclosures, and specifically understand what the seller is not obligated to disclose in their jurisdiction? (e.g., in many areas the seller is not obligated to disclose if a child sex offender lives next door). Is the neighborhood up and coming or struggling? Getting these wrong can easily negate the potential upsides of ownership. Renting can also be great, but as the article points out, if it mostly just results in more disposable cash, then you may be better off owning (forced savings). Rental properties often cannot be sublet and also cannot be used as collateral or passed on to family members with a step-up in basis. Rental leases also fluctuate with the market, so it's not uncommon in big cities for renters to be paying close or equal prices of their homeowners next door. Anecdotally I know many folks who have rented their way through, invested wisely, and done well. I also know folks who have moved around the US and always purchased, did their homework, capitalized on tax incentives, and now have a stable of rental properties that helped them become FIRE.
- dangus 1y agoI like the general idea of this post but in the end I think it suffers from being too generalized and a little bit too renting biased. > The math can always be made to “work” if you’re willing to adjust what or where you buy. This is essentially a useless statement, the result of the math is either that either renting or buying makes you end up more wealthy. Whether it "works" or not isn't even the question, the question is which choice makes you more wealthy over time (more on that later). For that, it's more helpful to use a rent vs. buy calculator [1] with the details of your market plugged in. Whether renting or buying makes more sense for you has a lot to do with where you live. Let's continue on to the next section, "Buying a Home Isn’t Really an Investment." The obvious rebuttal to this is "of course it is!" > The decision is usually driven by lifestyle factors such as proximity to work, school districts, family, and the neighborhood. All of these factors play in to whether or not the property is a good investment. Places that are in good school districts and have close proximity to job centers are good investments. The real estate investors that this section mentions think about these exact same things before starting projects. Next section: "People Tend to Overbuy." Is there any data or evidence behind this whole paragraph? Are we just saying that people who own homes buy more furniture and stuff than renters? Maybe they do, but even if that's true could that be because they're more wealthy in the first place? Who knows, this entire paragraph is all assumptions and nothing backing it up. Next section: "The Flexibility of Renting Is Undervalued" 6/10 Americans live within 10 miles of where they grew up, and 8/10 Americans live within 100 miles of where they grew up. [2] Is the flexibility of renting actually needed for most Americans? Are Americans missing out on job promotions because they own homes? (It's not like you can't sell a home quickly) I would counter the premise of this section with "The stability of home ownership is undervalued" and "the 30-year fixed mortgage is a gigantic subsidy to homebuyers." By taking out a mortgage, homeowners are locking in the majority of their monthly cost with the exception of maintenance, utilities, and property taxes. They sit in their house for a few years and they end up paying below market on monthly payment compared to renters. So maybe they "overbought" a home with too many bedrooms to fit all phases of life, but it doesn't really matter because after the first ~5-10 years of home ownership they are going to be paying less than market-rate rentals. The 30-year fixed mortgage allows homeowners to refinance and minimize their rate pretty much any time the rate drops, so basically every renter is always getting the lowest rate possible since from their purchase date forward, and it never goes up. The last section: Why the Home Investment Myth Persists Sure, this section is technically correct, someone investing money elsewhere is going to beat real estate on returns. But you can't live in an index fund, an index fund may not have the same protections [a] and tax incentives as a home, and it is a fact that most people are not disciplined with investments which means the forced investment of a mortgage's end result is that homeowners are far more wealthier than renters on average. [3] [a] For example, your home equity doesn't count toward the ability to pay calculation for FAFSA, and you are generally protected from having your home taken away from you if you get into most debt situations. Check out how OJ Simpson avoided paying his civil judgment: https://www.kiplinger.com/retirement/how-did-oj-simpson-avoid-paying-the-brown-and-goldman-families https://www.kiplinger.com/retirement/how-did-oj-simpson-avoi... [1] https://www.nytimes.com/interactive/2024/upshot/buy-rent-calculator.html https://www.nytimes.com/interactive/2024/upshot/buy-rent-cal... [2] https://www.census.gov/library/stories/2022/07/theres-no-place-like-home.html https://www.census.gov/library/stories/2022/07/theres-no-pla... [3] https://www.nar.realtor/magazine/real-estate-news/study-homeowner-wealth-is-40-times-higher-than-renters https://www.nar.realtor/magazine/real-estate-news/study-home...
- motbus3 1y agoIn current market, owning dozens of properties is not a good investment. Owning thousands is. And, in my opinion, which does not mean much, is one of the problems. I have a friend living somewhere in the UK. He wants to buy an apartment. He has the conditions for it, but he cannot because every single building in his city belongs to the same company who keeps them to inflate the prices. Why there is no exponential taxes for owning that many properties after they are finished?
- zeroq 1y agoCounterpoint: buying is always better, people just can't afford it. Here where I live the minimum price for rent is monthly mortgage installement, meaning that you'll pay for rent at least as much as you'd pay for mortgage. But after you pay your mortgage you still have an asset in your hand. You can pass it on to your children or you can sell it when you're old, downsize (or even rent) and get some cash for your retirement. If you rent you're left with nothing. Then why is not everyone buying? Because few people can afford the 20% downpayement needed for mortgage. In reality it's even more because you have to furnish and/or renovate the place. Renting has it's charm for youngsters, but once you get older and you start acummulating things the lack of stability and the danger of your landlord having a change of heart and breaking the contract (either because he decided to sell it or give it to a child) becomes a pain in the ass. Even having a pet is troublesome and many property owners will refuse to rent if you have a dog or a cat.
- wavemode 1y ago> If you rent you're left with nothing. Well, no. You're left with the cash you would've spent buying a house. Whether that's financially better or worse, depends entirely on the mortgage interest, taxes, and maintenance costs of the house, as well as the money you could have earned investing the cash elsewhere, compared to the rent you would have spent over the same time period.
- zeroq 1y agothat's true only if you were homeless
- estimator7292 1y agoWhen renting a 1br costs as much as my mortgage on a 3br, I don't think that really tracks.
- klipt 1y agoDepends where you live though. In the SF Bay Area, buying requires a monthly payment several times larger than the rent for an equivalent place.
- ajross 1y ago> Buying a Home Isn’t Really an Investment That's... really not correct. And the section that follows the heading doesn't talk about (or even try to define) "investments" at all. A home mortgage is a heavily (!) subsidized, very safe, easily-acquired and extremely leveraged investment in an asset class that tends over long terms to grow as well as anything else. A young professional looking at a putting $100k into stocks or as downpayment on a $500k (!) mortgage is just a no brainer. Fast forward 20 years and the 5x is applied to all the appreciation. Buy homes, folks. Worry about renting only when you're old and are making the decision as to whether to by your fifth home for cash or to finance and put the money into another asset class. The only time you decide not to is when you know a priori you can't hold the property long enough to cover the purchase overhead. (That said: there are lots of macroeconomic and environmental reasons to think a culture where everyone should buy a home is a bad thing. But in our culture, everyone should buy a home.)
- mandeepj 1y agoOne size doesn’t fit all Have you ever seen a realestate agent renting? So, does that make you think - maybe ownership has more benefits!
- cramsession 1y ago> People obsess over granite countertops, open floor plans, stainless steel appliances, and walk in closets. These might make you happy but they don’t make you rich. Money is a means to an end, and being happy is a fine end. I only live once and if I can be happy, well then I've pretty much won. Also you're not going to "get rich" by renting, if (and it's a huge if) you can somehow make renting work in your financial favor compared to buying, it's going to be a tiny bit better. You're not going to 10X your income renting. He also completely discounts the cost of moving constantly (aka "flexibility"), movers, deposits, furnishings... it's not cheap. Yeah you can move yourself (add in the cost of vehicle to make that happen) but it's going to take time, and time is money. This is not a well thought out article.
- etrautmann 1y agoThat’s absolutely not true. In NYC, I can get rich by investing the difference between a mortgage and my rent, and there’s literally no period over which it makes financial sense to buy. People still buy if coursed but it’s not because it makes them rich (at least in this market with this interest rate).
- jjav 1y ago> I can get rich by investing the difference between a mortgage and my rent After just a few years into ownership, mortgage becomes cheaper than renting so it is the homeowner who will have extra cash to invest for the rest of their life, not the renter.
- dbish 1y agoNot in New York.
- cramsession 1y agoRents in New York are notoriously high.
- theptip 1y agoUnfortunately, a bit of a one-sided article. The most convincing argument for buying housing is that it hedges you from potential large future cost of living increases. If you can’t afford repeated rent increases then the consequences will ripple through your life. I’ve heard this pithily stated as “you are naturally short housing”. https://thezikomoletter.wordpress.com/2012/12/10/you-are-naturally-short-housing/ https://thezikomoletter.wordpress.com/2012/12/10/you-are-nat... Another newer argument is that if you think inflation could be much higher in the future, then a 30-year fixed-rate mortgage is a very attractive instrument; it’s a government-financed option. May as well benefit from it while it lasts. (If rates go down you can just re-fi.)
- barchar 1y agoIt hedges the cost of living _in that particular house_. However, housing costs are driven by the area's income, so your hedging against something that's likely to benefit you anyway. Otoh renting hedges you against collapsing local incomes, because your rent would then go down, and you could move without being a forced seller.
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- Justsignedup 1y agoCounter thought: Rent is going up A LOT every year. My parent's house in a similar area is not, even with extra taxes, it is far lower than what I pay. They fix up something, its fixed. We have a problem -- it will be fixed in the cheapest possible terribly looking way. And rent keeps going up. All the time. By so much. There's flexibility in it when you're in your 20s. But in 30s and 40s its terrible.
- kritr 1y agoMy current assumption is that other classes of assets, assuming technological progress continues at its current rate, will grow significantly faster than demand for land. So the economics that once made homeownership favorable, no longer exist. Holding the assumption that your landlord operates on favorable conditions (mine is pretty responsive and rent increases are controlled), I’m not sure I have a good reason to opt to purchase a house unless I’m planning on occupying it for the next 2 decades at minimum. I can’t help but think purchasing is an emotional decision, unless the location you live in allows you to buy for a similar rate to the mortgage pricing, but I’ve only observed this in LCOL areas.
- avianlyric 1y ago> My current assumption is that other classes of assets, assuming technological progress continues at its current rate, will grow significantly faster than demand for land. You seemed to have missed one unique attribute of land. They’re not making any more of it.
- xyzelement 1y agoThe fact that the author writes about his buying decision in first person singular is telling. Home "as a product" (vs investment) is contingent on your situation in life. If you are a single person who is likely to get married and/or move for work, why would you buy? The transaction costs of buying and then selling are non trivial. On the other hand if you are with your wife and kids, the potential ability to move for a job is less important (objectively) than community you are establishing for your kids and family. So it's not just those who value stability vs flexibility as a behavioral trait but as a realistic reflection of a situation. It's like a bike guy becomes a minivan guy when he has 3 kids.
- malshe 1y agoNYT has a nice calculator to help you decide renting v buying. US only. It is updated until July 2025. https://www.nytimes.com/interactive/2024/upshot/buy-rent-calculator.html https://www.nytimes.com/interactive/2024/upshot/buy-rent-cal...
- munksbeer 1y agoThis one doesn't require an account: https://smartmoneytools.co.uk/tools/rent-vs-buy/ https://smartmoneytools.co.uk/tools/rent-vs-buy/
- pton_xd 1y ago> People rarely buy with a purely rational investment mindset; they buy based on lifestyle and emotion. > If you bought a home equivalent to the apartment you’d rent, or a slight downgrade, you might come out ahead financially over five years. This is really the key point. Everyone I've known personally who buys a home does so with the intent to "upgrade" their lifestyle. Even if they were perfectly content before in their 1000 sq ft 2 bedroom apartment, they aren't content purchasing the same size home. Instead they upgrade to a 1700 sq ft 3 bedroom home, or larger, because after all owning a home is supposed to feel better than just renting an apartment. In financial terms, they are worse off, but maybe they are happier with their spending (I'd hope).
- cramsession 1y agoIf they want children, they’ll need more room. Same if you want/need a home office or to move an elderly parent in. I wouldn’t really classify those things as “feeling nice”, more going through natural life stages that renting a 2 bd may retard.
- jokethrowaway 1y agoWe have kids, we're a bit crammed in our current place and we're building a 3x bigger and much nicer place. Location is a small LCOL country in Europe with high foreign income. So, I see your point about naturally needing more room with kids, but there is also a lifestyle upgrade factor for us. We would be comfortable with 2x the space and without modern / luxury finish, spending less than half. The rent I pay now is 1/12 of the rent I would get charged on the property I'm building. I'm happy paying my current rent, but I would never rent a fancy property and spend all that money with no equity, even if it would be less than 30% of my monthly income.
- xtiansimon 1y agoWell. Lots of ideas there. But I just bought into a Coop because my rent went up 40% in one year. Since 2015 rents have gone up something like 50%. My experience says it’s true. Now as an owner (of shares) I’m pegged to my mortgage (fixed) + HOA (and their scheduled increases) for the next 30y (if I choose). That’s something. The thing about renting is, unless you’re in rent-controlled district, it can go up any amount. And in my experience, what’s advertised is always more than what you’re paying.
- bradlys 1y agoI'm currently in the bay area in a 1950s home with no AC, no insulation, and single pane windows. Do you think that's what I want? No but I can't change it because that's what is mostly available on the rental market in the peninsula. If you go into buying, you can find all kinds of well appointed homes (even brand new homes). No one updates rentals here. So, at a certain point, if you want to live like you're not in the 1950s anymore (and lord knows - we are not living in the 1950s climate, holy shit it's way hotter) then you have to buy.
- archagon 1y agoThe comments here are making some odd assumptions: 1) That buying implies owning your own top-to-bottom house, with no adjacent neighbors. 2) That renting necessarily comes with arbitrary rent increases and risks of eviction. 3) That mixed communities of buyers and renters are uncommon. None of these is necessarily true if you live in a city, depending on the city. It sounds like a lot of people are actually comparing “living in an apartment/condo” to “moving out to the suburbs,” not renting vs. owning.
- necovek 1y agoIsn't that also what the OP is doing? They are comparing renters to owners who are usually in a different life situations (with the basic being kids vs no kids). There are a lot of compounding factors OP is ignoring, likely out of not being in a set of life situations yet. Thus commenters are bringing counter-exampled to dispute the OP claim, not as the 100% truth either.
- QuiEgo 1y agoI feel like real estate markets have way to much variance country to country, city to city, or even neighborhood to neighborhood, to make generalizations like this.
- defterGoose 1y agoThe author disclaims that he's not a homeowner at the very end of the article, but these types of pieces steelmanning renting always read to me as thinly veiled pleas of "please exit the market so I can have more".
- bdangubic 1y agothis is one of those where sheer facts and numbers can be interpreted either way and more so (in my opinion) than most other “arguments” it is almost impossible to change someone’s opinion once it formed. I once spent 1/2 my Sunday trying to convince my best friend that he would have financially been better off if he rented (he paid off his house which he can sell today for $2,000,000) - I came with receipts (pun intended) showing how he would have been significantly better off if he rented and invested in the market but to no avail :)
- onecommentman 1y agoAnd over the decades there have been many more pro-renting pieces like this in the general press than pro-home ownership. I’ve assumed the pieces are bankrolled by the investment community, because investment bankers can’t make money off of your money if your money is locked up in a home. “Rent your apartment, save the difference, invest it in the financial casino of your choice and maybe you’ll win big this time.” Or maybe not. But the house (investment brokers) always win.
- skrlet13 1y agoI like the stability and peace of not being homeless. I'm glad I have a place to live. I am lucky I don't need to pay rent, or else I'd have to choose between rent or groceries. When you pay rent you are dependent of a landlord, who has a lot of power over you when you are vulnerable. Being homeless is a cruel situation, and they know it. Problem is most people can't afford owning a home nowadays. Power imbalances increase even more...
- nicbou 1y agoThe location should be mentioned. Renting is a lot more sensible in countries with strong tenant rights.
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- DoctorMckay101 1y agoThe interest rate on my mortgage has been below inflation for 5 years now. I'm 7 years shy of paying it fully. I pay around 850€ a month for my mortgage + 110€ monthly community costs + 400€ on property taxes annually. Lets round it up to 1000€ a month. Meanwhile, the average rent around me is about 1150€. If I was renting whilst sharing with other 2 people I could be paying about 400€ and have about 600€ a month for investing, that is true. But that would mean I'd be changing places every 10-16 months, increasingly paying more, and gambling on landing good flatmates. A ton of stress and almost ensured mental health issues. I´d know because that was my life from when I was 18 to when I bought my home at 26. If I wanted to rent my spare rooms I could be racking about 800€ a month - 20-27% set aside for taxes. Always cherrypicking my flatmates and increasing their rent every now and then. However, I wanna live alone for a while, be calm whenever I'm at home. Even if that "math" does not work for you, take into account those 600€ monthly investment would have to compete against my home's value. My property has appreciated about 90% in the last 10 years, practically doubling my potential earnings compared to the original cost. From 300k to 570k on 10 years. There is no way somebody with 0 investing knowledge could pull that off. Renting is just better if you have enough fuck you money to rent whatever you want, whenever you want, with the flexibility of choosing to be alone or accompanied.
- JackMorgan 1y agoI've yet to see the solarpunk argument: buying a house lets you generate value with the land/building. For example, perennial fruit and veggie gardens in your backyard let you invest a small amount of time and energy building a long term yield of high value food. This year I spent about 25 hours growing $800 of clean organic veggies. I also prepped areas to plant fruit trees and bushes that I expect will increase my yields in a few years. Solar on the roof / yard can reduce electricity costs for decades. Rainwater capture and filtration can reduce water costs. Renting out a bedroom can produce dollars. Building a climate battery into a yard can reduce heating and cooling costs. I ran some numbers and figure I can shave several hundred dollars a month off at a 30% ROI. And it's not just about dollars, there's something very powerful about knowing my property is supporting my life with these investments.
- Anonyneko 1y agoI really need some advice because I feel like I'm missing something, but here in Finland after some basic calculation I just don't see how a mortgage makes sense, especially for someone ineligible for ASP (local savings scheme for first home buyers, but it has many restrictions). Home prices are not appreciating (which I otherwise consider a good thing for society), tax breaks for mortgages were abolished a few years ago, rates are at about 3%, down payment and collateral guarantees (when you don't have local collateral as an immigrant) make for a pretty hefty lump sum. Throwing the numbers into a calculator and pitting them against a 6% annual ETF over 20+ years seems to be too much in favor of the ETF, even with potentially higher rent down the line.
- oliwarner 1y agoCan't believe an article on rent-vs-buy doesn't feature the word "evict". Yes, renting allows you to up and leave, but buying gives you the security you won't be homeless when your landlord gets bored of you. This really matters when you have roots. Kids in school, proximal employment, friends and family nearby, a lifestyle.
- CM30 1y agoFor me personally, the two main factors that made me buy a home (and avoid renting anything when not required) are stability and control. Renting leaves those up to a third party, ownership means you're the master of your own domain. That's important for both political and social reasons, and for peace of mind ones. For example, I know way too many people who rented a place, treated it well, paid exactly what they needed to and who were model tenants... that then got kicked out in short order because the landlord decided they'd make more money selling the property or by trying to find new (and better paying) inhabitants. Owning means not worrying about that situation. About being told you've got a few months to get lost, and the resulting pressure to find a new place before homelessness sets in. There's also the political side. I know rental agreements are stronger than many similar ones in other industries, and that it seems unlikely now, but renting feels like you're leaving your life and usage of a service up to the whims of a third party, and one that could easily decide to terminate said service if you get into a controversy or legal trouble. We've all seen cases where large companies kicked out customers that made them look bad, even when what they were doing was entirely legal. Owning things means you don't lose them if someone else hates you and everything you stand for, and gives you stability when you get caught in drama of any kind. Meanwhile, the control side can't be overstated here. Landlords can decide you can't alter the property in any way, including hanging up paintings or shelves or changing the lighting. They can decide that pets aren't allowed, or how many people can live at a property. They can refuse to upgrade or install services that might be necessary for many of us, like high-speed internet. Owning means you're the one that chooses how you want to decorate the property, what changes can be made, and who/what can live there. I can choose to have everything remodelled or reinstalled or replaced depending on my tastes, to have pets or roommates, to upgrade or install whatever services I need and how I want everything room laid out and decorated. For me, that's how I treat basically everything. Why give up stability and control for convenience in any situation? I don't lease vehicles, use streaming services or rent any physical object, and I avoid digital games and cloud services unless absolutely necessary.
- kkfx 1y agoWhen living with inflationary currencies, over-buying is logical: you buy more today than tomorrow for the same amount of money. With deflationary currencies, it's the inverse. When you buy, you transfer money into an asset that will be resalable one day. It might be worth more or less money than the original, like any investment. It might be that having bought something else (e.g. financial instruments) and rented a house, after deducting rent, taxes (in both cases) etc., you end up with more money than if you had bought, but it's relative and by no means guaranteed, also because those who rent out generally are better off financially than those who rent, so, as they say... When you rent you just consumed money over a certain period. No resale. The current narrative, the push for Agenda 2030 where "you will own nothing", clearly shows this contradiction, because if it's so advantageous not to own, how is it that all the wealthy individuals do the exact opposite as much as they can?