If you’re in the wealth accumulation phase of your life, I think buying a home is a terrible decision (in most cases). Prove me wrong. Seriously. I’m not being rhetorical. I want to see if there’s math that says otherwise.
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You have to compare the alternative. In my case, my mortgage payment was 20% less than my rent. One is burning money and the other is earning (house went up 22% in 15 months). I think buying a house is better than renting, specifically buying a house under $500K (3% down).
I did compare the alternative. That’s the point. I’m saying it’s a bad financial decision because there are so many better ones.
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Also, that 20% doesn’t include taxes and fees. It also won’t happen each year. Stocks outperformed over 100 years by like 2x. And you can’t click a button and liquidate it for, say, starting a business that can grow faster than 20% a year in value.
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You have to live somewhere. My total payment is less than when I paid rent (more cash to invest today vs then) and my my payment each month is owned vs not owned. The only difference is down payment which can be viewed a low risk “investment”. How’s that not better?
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Key answer is it depends: https://youtu.be/F3PIObPVRPk This is the best financial breakdown I’ve seen. I bought and I would do it again (how I measure success). There’s nothing like not needing to ask permission to do whatever you want in your home.
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I think buying so you can do what you want is an amazing reason. But still don’t see how the average beats the average of other investments that are equal or less work if you’re comparing it based on accumulating money.
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I agree with Adam, as long as you're in one location, and buy a house on a 15 year (or in cash) and the payments don't exceed 25% it's a better financial investment than renting. (And as long as your property taxes are insane)https://www.daveramsey.com/blog/5-steps-to-buying-home-wont-bust-your-budget …
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Seem like a no brainer, take what you saving in comparison and invest the remaining while still owning the house
End of conversation
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Show me the math.
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Yeah I guess if you're saying you'd accumulate wealth better if you lived in your car then... I mean sure dude. Looking at housing as an investment is a mistake in the first place. It's a cost, so how can you minimize it? If rent is more expensive than a mortgage then don't rent
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Can we see your math? What investment are you saying creates returns that offset the loss of rent + appreciation of property?
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Yep, the biggest fallacy is to assume that house value would indefinitely appreciate. I live in Alberta and the opposite happened in the past few years - all costs included, renting is better option compared to what you can do with the down payment.
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