• Sagifurius@lemm.ee
    122·
    11 months ago

    In a very specific scenario, with a very large amount of running the numbers, as a high income person with low personal expenses and a very good investment advisor, I could see how in certain situations/locations where mortgage rates are much higher than rental rates, that you get better fiscal results investing than paying that mortgage. That was a very rare situation 7 years ago, even more rare now. Where I lived ten years ago, I could not possibly afford the mortgage but I could the rent. These days there the situation has reversed and they’re both sky high regardless.

    • quo@feddit.uk
      22·
      11 months ago

      Yeah, for a decision this big people consider all the pros and cons of both. The previous commenter never mentions:

      • Accumulating interest on a half a million dollars starting the first month, at a time of high interest rates.

      • Paying property taxes, even after it’s paid off.

      • Higher insurance costs

      • Sacrificing promotions and raises in a career because you’re stuck in one place.

      Often it still makes sense to buy a home, but not always. A proper calculation means subtracting these from the equity being built to get a proper net change in wealth.

        • quo@feddit.uk
          3·
          11 months ago

          Sometimes they do charge you less, because they can’t find anyone to cover their investments completely. They prefer to recover 80% of their investment, rather than 75 or 0. That’s less common today, but it happens in normal times.

          Not being able to move for work could end up costing a lot more than the lost equity building, depending on your career and if you have to stay in town for family reasons.

          There also bulk rates for the manager and economies of scale in apartments that make them cheaper.

          The current rate hikes did change the logical financial decision for some people. It’s not always best to buy, it depends on many factors.