If a house wasn't seen as a way to get rich we would have more housing. Everyone could put their savings into other investments and pay a pittance for their home.
If I could have bought my 4 bed house with average garden on the outskirts of London for £50k, I wouldn't have bought it. I'd have bought an 6 bed house with a swimming pool, huge garden, double garage and driveway in central London instead, for the price I paid for my house. Not to get rich, just because I'd like more space, a pool, a big garden and a short walk to one of the world's best city's centre.
It's a physical impossibility to build everyone a large detached family home in the city centre, and most people don't want to live in apartments forever.
I believe the real solution is allowing small towns to grow into cities, and building a ton of very fast and effective rapid 24/7 transport so you can ferry people into the urban core of large cities from those cheaper smaller cities. We can scale out fast trains in a way that we can't scale out cycling, walking and cars.
In my mind, the ideal model for a livable megacity is an extremely large conurbation of individually small, walk/cyclable cities with low to mid-density housing, with the cities separated from each other by large public green spaces and all linked together with rapid public transport, and huge disincentives for cars.
I believe this would not be the case if we built apartments better.
For my personal take I'd need a communal workshop / garage to store and work on my motorcycle, far better sound deadening, equivalent square footage of personal space, a nice playground for my kids, affordability to move to N+1 bedrooms when N+1th child arrives, and that fresh clean air feeling that the suburbs has which downtown SF's crap and urine infested streets do not... oh and as affordable as the suburbs (net of benefits of being central)
You do get less freedoms as a renter though. Like I've never had the option to choose any kind of paint, tile, carpet, on demand water heater, reverse osmosis water line etc etc.
But you get other freedoms, like being able to move without having to go through the pain and cost of selling you house. That being said, I do agree that "all things being equal", it's better to own than rent; but there are certainly cases where renting makes more sense.
Plus I don't think all landlords are evil. I've had a number of them that were fantastic people; more than the number of bad ones I've had.
It sounds like a Fat FIRE concept that is out of reach of most people. Or at least something the average person would only be able to access later in life.
> You do get less freedoms as a renter though.
But you also aren't responsible for all the things that can break. And natural disasters.
I have heard of many renters painting their apartments.
It's not that far off the amount sunk into a equity+interest view of a mortgage ... eg a $500K house would be about $1M after interest. A $1M portfolio would provide about $2500-3300 a month in passive inflation proof income[1]. A quick rule of thumb is a place should rent annually for about 1/19th - 1/20th the purchase price which conveniently is about ~2200 a month...
So overall if someone could afford to buy, they likely could also afford to choose a portfolio and a reasonable rent.
[1]: we'll have to wait and see how true this remains through the kind of inflation we're seeing lately though...
> I have heard of many renters painting their apartments.
Yes, but they likely either were renting a place that had terrible paint (doing their land lord a favor) or had to return it to the original colors at the end of the lease, else face "repair" costs
I have a full sized private garden that I can grow plants in, keep a large bunny enclosure, shed, and let my dog run around in unsupervised. I spend a lot of time in my garden.
I can just drill holes in my walls without asking anyone and never have to share a lift with neighbours. I can hand out keys to whoever I want without building management getting on my case, or indeed replace the keys with a non-key entry system. I don't need to spend 2 minutes waiting for a lift to get downstairs, or longer if someone's decided to block the lifts while they move in/out, or climb 15 floors because they broke the lifts.
Personally, moving from an apartment to a house has been the biggest QoL improvement in my life since I left home 15 years ago.
Whether you live in a car-dependent suburb, or in a city, real estate that lets you save time when living will always be more valuable.
In addition, low interest rates might be the reason people CAN buy houses with enormous valuations. Not just housing is overvalued, but companies' stocks also.
> Not just housing is overvalued, but companies' stocks also.
Berkshire has outperformed houses.