[neuxenian]

Leverage cuts both ways, though. As someone who just sold their house, the costs are a percent of the sale. You don't get taxed on the sales (generally) but you will probably have to pay real estate sales costs. So yes, if your home increases by 3%, you've gained 15% growth on your investment, but if the sale cost is 5% of the the sale price, then things aren't so clear anymore.

The real calculation is the total monthly cost of ownership plus any sale prices on the buying and selling ends over the period, relative to the total costs of renting.

Over the 10 years we've owned our home, yes, it's been worth it to buy, because we can recoup money that would have gone to someone else.

However, over a short period, the sales costs would dwarf any returns we would get.

The sales costs are largely fixed on both ends, as a percent of home value, and diminish as a total percent of gains over the period of ownership. So the period of ownership is relevant.

This in turn is relevant because your mobility becomes relevant.

The previous market we were in too, was so overpriced relative to the rental cost that we actually saved money over the period by renting rather than buying. Then the Great Recession happened.

Either strategy makes sense depending on your mobility risk and the market. I don't think it's clear that one or the other is generally better.

[jacquesm]

5% is the norm in the United States, elsewhere it is a fraction of that. US consumers have become accustomed to being ripped off by realtors.

[eaenki]

In Italy 5% is the norm as well.

[chii]

> This in turn is relevant because your mobility becomes relevant.

you don't need to sell, just rent out the apartment when you move.

With the rental income, you can pay for a similarly priced location in the new place. Then, when the market fits, make the sale, and you've lost very little (if anything), except upkeep costs due to rental damage, etc.

[lotsofpulp]

The risks of renting property are not to be understated. Unless you have significant time, cash, and drive to deal with the myriad issues tenants can have and possibly lawyers, it can easily be a net loss especially with the stress involved.

[scarface74]

You say just rent it out like renting doesn't have its own downsides like finding decent tenants, dealing with repairs, having to carry the mortgage when you have vacancies, dealing with evictions when they don't pay.

Even in a landlord friendly state it can take 2-3 months to evict someone for non payment. In some states I've heard that it can take a year.

I've been a landlord, never again.

[azeotropic]

This is also the downside of renting -- the other tenants can be lousy. Banks know this and will not lend in buildings without a minimum rate of owner occupied units.

I'd guess that one of the reasons home prices in 'nice' neighborhoods are so high (or HOAs charge high dues) is a sort of signaling, similar to nuptial gifts in animals, that you have your act together and are invested in being a good neighbor.

[scarface74]

I could never see myself buying anything that's not a detached house. It seems like you have too many of the downsides of renting. When I was living in an apartment, a never once said, "if only I could buy this place and have to deal with people on each side of me".

But as far as buying in a high priced area or even renting in a high priced area, price does provide a filter.

[bryanrasmussen]

renting out an apartment when you move does affect your options however because as such you will have the legal obligations of a landlord, and if not that because you have signed a deal with someone else to have those obligations on your behalf you will still need to pay those people and keep track of them.

Owning things adds friction one way or another.