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Originally Posted by epitaph
IIRC, the argument for renting over owning is if you invest the money you otherwise would put into mortgage, you will/can come out ahead in the end. And ofc mortgage isn't the only expense, you've taxes and maintenance costs.
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that is a poor argument and doesn't factor in leverage. That is important in market like NYC/California.
If you put in 100K downpayment for a let's say 800k house. The percentage appreciation of the house is on the 800K not your 100k giving you a significan't leverage.
if house prices goes up 3% in one year (which is historically the rate at which it apprecaites annually for some market ). that's 24K apprecaition. But if you invest outside you would need to have 24% appreciation else where to get to that 24K.
That is called leverage and all the calculations never count that.
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the queens house in my example... the house only doubled in value. But my initiall investment for that house would be 150K or so...I would need to have 500% return to catch up to waht I would have made with the house in 4 years vs only slightly less than 100% gain..