Buy vs Rent in Paris suburbs: no brainer choice?
Hi everyone, I’m looking for some perspective on a "Buy vs. Rent" dilemma.
\- Profile: 31M working in finance/banking in Paris, my partner doesn’t work and we have a newborn, planning 2 more in the next years
\- Current portfolio: About 40k€ cash and 560k€ invested 100% in ETFs on diversified equities, planning to FIRE at 45-50 yo
\- Dilemma: I am considering buying an apartment (3-4 rooms) in a suburb just outside Paris with good transit connections, budget capped at 400k€ (there are several that I found within my budget)
The estimated monthly mortgage would be roughly equivalent to the rent I would pay for a similar property (but of course buying has some friction costs such as agency fees, notary fees, property taxes, extraordinary expenses etc, while also having the benefit of building equity with every mortgage payment)
My goal would be to get as much leverage as possible (ideally 100% LTV but ok also 90%) to keep my capital invested in the stock market.
Now, given my situation and the reasoning above, my question is:
If the mortgage payment indeed equals rent, is it a no brainer to just buy (in particular with high LTV to minimize opportunity cost of stock market returns) or am I underestimating something (for example the drag of real estate friction costs in France)?
Thanks!