Thursday, May 12, 2011

Building Wealth Through Renting

This is a nice post that pushes against the conventional wisdom that building equity through home ownership unambiguously dominates renting. Here's my favorite quote from the article:
Living somewhere is always going to involve costs, just as education, health care and food involve costs. Financially, the decision to buy is basically a decision that your investment will increase in value by an amount sufficient to make up for all the additional costs of buying. (Put it this way: you’d never buy an apartment if you were staying in a city for just a week, in an effort to build equity. You’d rent — a hotel room.)

1 comment:

  1. Hey Tony, I recently discovered your youtube page on intromediate econ. You saved me on my final and just wanted to say thanks!

    -Joey(University of Maryland)

    ReplyDelete

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