What is the rent for a 1500 sqft apartment compared to the mortgage for a 1500 sqft apartment? The rent is always higher.
What is the rent for a 1500 sqft house compared to the mortgage for a 1500 sqft house? The rent is always higher.
If I bought a house in the year 2000 for 200k, and still own it now, I might rent it out for $1200 per month (after refinancing in 2020 for a 2.8% loan on 50k or whatever is left on the mortgage), and still make a gross profit.
If the house were to be sold and purchased now in 2025, it may be valued at $600k or more. The mortgage on this house with 20% down would be like 3500 or 4000 per month after taxes and insurance.
So there is a huge plausible gap between renting and owning a property.
If you are arguing versus some potential mortgage in the past… sure. But you don’t get the mortgage of the past value, you get the mortgage of the current value with the current interest rates.
Estimated rent: $600/week Estimated mortgage repayment: $1000/week
If you get a 30 year mortgage, more than $600 of that will be interest near the start.
I didn't cherry pick this. I just clicked randomly on a big city until I found one with both estimates available.
You show me your source of information saying that it's never the case.
And, if you really want to compare apples to apples, you have to compare properties in the same area. Its easy to make housing look cheap when you compare upper Manhattan to New Jersey.
Suddenly that 4,000 dollar apartment looks pretty competitive when the alternative is 5 million mortgage + 3000 a month HOA.
No, housing is not always cheaper, feel free to do some research. Its highly dependent on your city.
If you truly think buying is cheaper in Manhattan then I don't know what to tell you. You're just wrong, period.
What's happening here is youre comparing suboptimal housing to THE ABSOLUTE most expensive apartments you can find.
My parents do the same thing. "Oh housing is so much cheaper, imagine renting in Dallas!"
But... We're an hour and a half outside of the city.
The reason the housing is cheap is because nobody wants it.