Buying vs renting
Hi guys, I’m not a Caleb Stan or anything, I feel indifferent about him. But a lot of the YouTubers I watch have covered his Joe Rogan episode, where he talked about how renting + market investment beats owning a home (investment wise).
I understand he owns a home and is saying other should do the opposite, but owning a home for him is a lot more inexpensive than your average Joe. Because he has enough money to avoid interest payments.
I did the research, a single family home that is being rented out for 3,500 a month is worth 900,000.
With a 20% down payment of 180,000, the cost to purchase this house with mortgage, property tax, insurance, ect. Comes out to about 5,500 a month.
Thats, about a 2,000 dollar difference.
If you take that 2k a month and invest it in the markets it will return about 8% - 9% a year, over 30 years, that becomes around 3.2 -4 million dollars.
If you were to purchase the house with a mortgage, you would see a home equity value of around, 2.1-2.9. For the cost of 1.7 million, once the loan is finished.
I personally would love for everyone to own homes, but the numbers do check out. (In the current market)