Here’s the reality. As with any analysis, it’s all about the assumptions.

Over the next five years, which is about the average amount of time recent buyers have remained in their homes, prices in the Los Angeles area would have to rise more than 5 percent a year for a typical buyer there to do better than a renter. The same is true in Phoenix, Las Vegas, the New York region, Northern California and South Florida. In the Boston and Washington areas, the break-even point is about 4 percent.

And in the end, it’s an individual decision.

Clearly, there are benefits to owning a house beyond the financial, like the comfort of knowing you can stay as long as you want or can fix the roof without permission. But real estate has been sold as more than a good way to spend money. It has been sold as a can’t-miss investment. Back in 2005, near the peak of the market, the chief economist of the Realtors’ association, David Lereah, published a book called “Are You Missing the Real Estate Boom?” The can’t-miss argument was wrong then, and it may still be wrong today.

And in either case, we do love that interactive graphic.

UPDATE: Yes, the “all important mortgage interest deduction” is accounted for in the interactive tool (not to mention the capital gains exclusion, transaction costs, and return on cash), but it also assumes a traditional fixed-rate mortgage amortization schedule. Before you critique, please take the time to check out all of the Advanced Settings (i.e., other assumptions).

A Word of Advice During a Housing Slump: Rent [New York Times]

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Comments from “Plugged-In” Readers

  1. Posted by Jamie

    What a cool tool! Thanks for sharing it.

  2. Posted by enonymous

    does that interactive tool factor in the all important mortgage interest deduction (i doubt it given that you can’t input income anywhere)

  3. Posted by enonymous

    nevermind my previous comment – didn’t see the advanced settings…
    [Editor’s Note: Which take into account much more than just the interest tax deduction (e.g., capital gains exclusion, transaction costs, return on cash).]

  4. Posted by hooper

    No mortgage interest deduction that I can see. That seems to me to be the single largest factor in the rent vs buy equation and it doesnt appear to be included in this calculator.
    [Editor’s Note: Not so fast. Did you notice the “Income Tax Rate” under General Assumptions?]

  5. Posted by OneRincon_Res

    “does that interactive tool factor in the all important mortgage interest deduction (i doubt it given that you can’t input income anywhere)”
    Exactly. And that’s not an insignificant input to be left out either. Let’s face it, highly leveraged real estate is the ultimate legal tax shelter.
    So for that reason alone, I have to give the tool a thumbs down in terms of painting an accurate picture as to whether buying or renting is the better option.
    For example, I’ve already determined, just based on a back of an envelope calculation, that I’ll save roughly $20K in taxes over the first 5 years of my mortgage when I close on my condo next year. You have to take that into account when you are making this decision.
    [Editor’s Note: We’d have to agree if it was left out, but it’s not. See above.]

  6. Posted by hooper

    I see a deduction for owner’s fees in the in advanced settings but not for mortgage interest. I will play with it tonight and compare it to my excel spreadsheet to see if I can make it work.

  7. Posted by Mike

    Maybe it’s just me, but the mortgage interest deduction isn’t all it’s cracked up to be. In my case, what I save in income taxes I just end up paying as property taxes. Of course, there are other benefits to owning, but the tax break isn’t what it used to be when the tax rates were higher.

  8. Posted by hooper

    Well, I’m not an accountant but I still dont see the mortgage interest deduction in their calculation. Income tax rate is not the mortgage interest deduction.
    [Editor’s Note: The mortgage interest deduction is derived from the loan terms and Income Tax Rate.]

  9. Posted by Cary

    This is a nice, but flawed, formula. It doesn’t account for tax bracket, the loss of mortgage deductions over $1M, AMT, or comissions to buy and sell the home.
    [Editor’s Note: You’re killing us. See above (or perhaps below).]

  10. Posted by Dude

    Either folks here can’t read or they have no attention span…
    Go to the top right of the chart, where it says Advanced Settings. Click on General. Tax rate is one of the inputs below, as is return on cash (savings, investments) and inflation. The other two tabs under advanced inputs have commissions and everything else, including renters insurance.

  11. Posted by 415

    I moved back to SF from NYC in July 2005 and seriously considered buying but ended up renting a very nice ~1000 sq ft. apt. in a desirable neighborhood. Main reason: the implied return necessary to breakeven on my investment. Using the NYTimes calculator (and my personal assumptions) the breakeven return required (on a condo comparable to my apt) is 8-9% appreciation per year. My personal choice continues to be to rent as I enjoy the financial flexibility that renting allows and am still able to invest in real estate through the equities market but it is not my single largest investment. One more FYI-the purchase price where I am neutral to buying vs. renting is $550-$600 per sq. ft. assuming a more reasonable 5%/year appreciation over a 5-10 year horizon.

  12. Posted by BR

    “Either folks here can’t read or they have no attention span…”
    Or they live in Egypt by a river called denial.
    The graph tells me what I’ve known for two years now: rent, and invest the savings. I’ve tried to convince my homeowner friends to get their money out while they can. Anybody who thinks the Bay Area is going to see an average annual appreciation of 5% or more over the next five years is smoking crack. The housing slowdown has been long overdue, and it looks like it’s finally arriving.

  13. Posted by kathleen

    If you pay 3000 a month in rent, and rents have been going up big time. We have been boosintg rents 20% on some properties in the past few years and have no problem gettingsignificant rental increased for nice properties.
    I think 8% would be conservative rental increase rate. I think its safe to enter 6% for the traditional year after year return on real estate in San Francisco. If you add that with 20% down on a 820K purchase, it would pay off before the 5 year mark.

  14. Posted by Cliff

    The default ROR on investments under ‘Advanced Settings’, ‘General’ heading is set to 5%. It’s possible that many of you more savvy investors would be able to beat this return which could lengthen the time before buying is better than renting.

  15. Posted by Jim D

    My numbers (which are for south bay):
    $2500 rent
    $700k house
    10% down
    3% price appreciation (What the heck, be optimistic)
    7% rent increase (Plan for the worst)
    Still 11 years to break even. Nope, still too expensive.

  16. Posted by greg

    How is 8% a conservative rental rate increase? Especially in rent-controlled San Francisco.

  17. Posted by Anonymous Jr.

    The legal annual allowable increase on San Francisco rent-controlled apartments is 1.7% a year (2006). Not 8%!

  18. Posted by 415

    “I think 8% would be conservative rental increase rate.” I pay ~$2500 and had a 2% rent increase last year due to SF’s very tenant friendly rent control laws. Of course, that is my situation-I cannot speak for the overall market.

  19. Posted by Anonymous

    Well, the tool also does not include the cost of capital for your down payment. Assume you are putting 500K down on a 1,200K condo. That 500K if you had it in the bank would earn you 25K before tax, risk free every year. So your cost of buying goes up. The tool is not perfect, but gives you a pretty good idea where things stand today.
    [Editor’s Note: Actually, it does. Advanced Settings -> General -> Rate of return on investments.]

  20. Posted by greg

    Every real estate investor in the national would flock to a place offering 8% annual bumps on residential or commercial investment properties.
    I do hear things are selling in the Marina district, so maybe with such little inventory in places, 2007 prices will stay flat, and avoid a decline?

  21. Posted by shineyspikeything

    “We have been boosintg rents 20% on some properties in the past few years”
    Many rental properties in the city are governed by rent-control, where those types of increases can’t happen. (mine included) Since I have rent-control, there is really almost no situation that would make it financially-advantageous to “buy” right now. and given the number of rent-controlled properties in the city, I’m not alone.
    “I think its safe to enter 6% for the traditional year after year return on real estate in San Francisco. If you add that with 20% down on a 820K purchase, it would pay off before the 5 year mark.”
    I disagree: In my opinion, real estate prices aren’t likely to rise 6% yearly in the next few years. The past year wasn’t that strong, and the steep run-up means correction ahead, whether it be a drop or just a lull.
    And I’m pretty sure that most people don’t put 20% down on $820K these days.

  22. Posted by Christopher

    Rent increases of 8%? 3.8% is a much more reasonable assumption for a high barrier market like SF, if you trust the investors with big bucks (see http://www.ciremagazine.com/article.php?article_id=1063.)

  23. Posted by RedHerring

    “We have been boosintg rents 20% on some properties in the past few years”
    Only if they were well below market to begin with which is totally irrelevant to this analysis. A market rate apartment going for $3,000 this year is not going up by $600 next year, and then $720 the year after that, and so on and so forth. Not even close even in buildings without rent control.

  24. Posted by Phil

    Wow, I never realized how much money I was saving!
    Rent $1550/mo (rent-controlled at 2% increase/year) v. a $400K home (not counting HOA fees) and it never makes sense for me purchase. When prices drop down around $300K things look a lot better, but we all know that there will never be a one-bedroom condo in San Francisco for that price.

  25. Posted by Dude

    Buy vs. rent aside, I feel compelled to comment on this tool. Thank you SocketSite – this thing is great. I work in financial consulting and build financial models for a living, and gotta say this thing is both easy to use and pretty precise. Great find.

  26. Posted by Anonymous

    Well yeah – rent control limits your rental increases to 2% as long as you stay in that unit for the rest of your life, if you move, you have to pay market rent. Personally, I see a trend for the foreseeable future where rents are going to increase at a faster clip than home prices. And it’s heartening to see that the other side of real estate ownership is finally getting press – tax and maintenance costs on top of huge mortgage costs add up to a very big number while the interest deduction is not quite the universal panacea that it is touted as. Sure, if you bought before the last decade of out of the ordinary price increases you are probably sitting pretty, but to project those same increases from here into the future should at the very least give people pause.

  27. Posted by jeccat

    One comment: for those of us lucky enough to have parents able to help out with down payments/closing costs, the housing market is about the only way we can get access to that kind of capital. Mom & Dad won’t contribute to the stock market fund, but they WILL help with a down payment. Only about 45% of my down payment is mine– the rest is from my parents and in-laws. So our “risk” is lessened because it’s not our cash– hard to figure that into the equation.
    Here’s how I’m looking at it: I consider our down payment the ticket price for our entry into the Bay Area housing market. Anything we make from a “starter” house goes into the next house, which we will probably buy in 5-7 years. If prices go up and up, we have made a smart investment– we caught the ladder at the right time. If prices stay even, we get the equity out and reinvest in the next place using that plus what we’ve saved in the meantime. If they go down, we lose some equity but the next place we buy is cheaper anyway.
    Could we make more money renting and putting all our spare cash into an interest-bearing account? Maybe–but we’d have less cash to play with (see above re: parents). Also, less parentally augmented down payment and closing costs, the price of our PITI (say $4300 per month) minus tax savings (about $1200 per month)is ALMOST EQUAL to what the place would rent for (I estimate $3K/month).
    If you look at the $125K as an investment opportunity lost, that’s one thing– but if you look at it almost as a sunk cost, a cost you won’t recover until you move out of the Bay Area, it puts a different cast on it.
    Just the 2 cents of a deluded buyer!

  28. Posted by Kathleen

    Not all apartments are rent controlled. You could be forced to move from a rent controled unit and then face huge increases when you need to pay for market rate. You have to factor in the cost of rental increase when you are forced to move against your will. That is the best reason to buy and not rent. Most people who live in rental controlled environment will be pushed right out of town if they are forced to move. Plus rent control does not apply to a lot of the San Francisco rental housing stock. Condominiums, SFRs and building constructed after 1979 have no rent control. I warn women especially all the time, don’t wait to long to buy, the rent control coccoon will not help when you are faced with a 300% increase or more in rent.

  29. Posted by Can't think of cool name

    Dependng on how you plug numbers into the tool, one can very easily prove that a purchase will be better than renting in a handful of years… or never.
    For me, its the intangibles of ownership. In my last home, I did not have to go to any type of association/building owner to get permission to replace my furnace/AC and water heater with better products, or rip up my carpets on my entire first floor and put down hardwood, update the kitchen, kick out some fairly large BBQ parties (heavy smoke included) on my self-expanded patio, or make the many various tree removals/plantings on my property.
    Sometimes, its more than just about the money…

  30. Posted by Anon

    Correction – houses and condos that are rented are subject to rent control, but have more lenient rules about an owner move in eviction when you want to occupy it. But you are right, being forcefully evicted can put you in the market for market rate rentals. If you live in a 2-unit building your chances of eventually being evicted for someone buying the property to convert it to condos is pretty high I would say. With 3+ units though, that risk is a lot lower now with the tougher rules about entering the condo lottery with evictions.
    [Editor’s Note: In general it’s actually the other way around with regard to houses/condos – no rent control but the same restrictions with regard to evictions. If you have been a tenant since December 31, 1995, however, you are covered by rent control as well.]

  31. Posted by Gdog

    Rent control only applies for units older than the early 1970s. At South Beach Marina Apartments my rent went up almost exactly 10% in each of 2005, 2006 and 2007 (including move-in incentives). Since SBMA is so large I think that’s a fairly good rent benchmark. If this trend continues then that tips things very much in favor of buying. So, another way for the “housing P/E” to lower is for rents to move up rather than purchase prices to move down. I’m not saying that’s going to happen — just a possibility.
    [Editor’s Note: The rent control cutoff is actually June 1979, but we do believe that market rate rents are on their way up.]

  32. Posted by tipster

    Geez, I plugged in the numbers for my current rental and my prior one. At current prices and current rents, Never. It will never pay off to buy.
    And those of you worried that rents will rise forever, are forgetting that what will likely happen is that places will be put on the market for sale at 2005 prices, sit, get taken off and rented. When that happens, probably by this fall, look out below. Rents will drop as the supply greatly exceeds the demand.
    A lot of these places will be second homes that are not even occupied right now. Thus, supply of available residences for rental or purchase will increase dramatically, even if no additional units get built.
    There is, unfortunately for the economy, no way to stop this, any more than one could have stopped the dot com bust.

  33. Posted by Snark

    So glad I didn’t buy two years ago– The savings (plus stock market earnings) in renting a one bedroom apartment has been around 70-80K. And with a rent controled apt there’s no reason to change strategy.

  34. Posted by Hooper

    Its not just south beach where rents are increasing. If you want to rent an A++ property in the Pac Heights area, you’re looking at 5+ K/month. Also, as the editor notes, this calculator doesnt take into consideration IO loans. My wife and I want to live in the city for another 7 years or so- and then move into a bigger house out in the burbs. Given this time frame, it makes sense for us to go Interest Only in our mortgage, which tilts the balance in favor of owning vs renting.

  35. Posted by [prime]

    Why is it that over the past 7 years, whoever bought is much more wealthy than the same income earning who didn’t and rented?
    A friend bought a SFH house 2 years ago, and 6 comps have sold in that time period for 10% and now 25% more. Does nobody live in San Francisco here? Just go to the open houses in desirable neighborhoods, they are packed!

  36. Posted by [prime]

    I know so many people who rented since 2000/2001, and ‘invested the difference’. They lost their shirts, some by more than 50% in 2001-2003. They are just now starting to make money on the money invested 6-7 years ago, meanwhile housing has appreciated by over 50-60% in that time frame, and all homeowners had to do was live in it.
    Rent control only pertains to multi-unit buildings built before 1970. If you own a condo, and rent it out, you are NOT under rent control. You can charge whatever the market rate, and raise if you give a 30/60 day notice for 10% and under, and over 10%. Come on guys, this is common knowledge.

  37. Posted by Anon E. Muss

    @tipster
    I’ve been informally following South Beach and SOMA rentals. The supply of rental properties is steadily increasing, but the prices to rent are still more expensive than most other parts of the city. It almost seems like the landlords would rather have empty rentals than rent them out at a “discount”.
    There is no downward pressure on rent prices. It would be interesting to see some kind of “DOM” figure adapted to rental properties.

  38. Posted by dede wilsey

    wow, i pay 960$ for 400 sq ft in nob hill and studio condos are going for 350k at the least. and my rent increases 1.7% every year thanks to rent control. maybe i’ll give my landlord a hug tomorrow on my way to work.
    (i thought a 15 yr loan would allow you to build equity more than 2x as fast as a 30 yr loan–but doesnt seem to affect the years required to cross the line. )

  39. Posted by Michael

    “I know so many people who rented since 2000/2001, and ‘invested the difference’. They lost their shirts, some by more than 50% in 2001-2003. They are just now starting to make money on the money invested 6-7 years ago, meanwhile housing has appreciated by over 50-60% in that time frame, and all homeowners had to do was live in it.”
    Keep in mind that that most of those people who lost their shits in 2001-2003 were saying similar things about all those fools who had missed the bus and failed to invest in internet stocks in the late 90’s. You’re sadly mistaken if you think real estate is risk free and the next 7 years will be anything like the past.
    “Rent control only pertains to multi-unit buildings built before 1970…Come on guys, this is common knowledge.”
    Not even close. The cutoff is June 13, 1979. That’s real knowledge.

  40. Posted by [prime]

    The gap between the haves and the have nots have grown massively due to real estate appreciation. It is understandable to be frustrated and wanting real estate to crash. But, the fact of the matter is, people are getting paid, and unemployment is low, while rents are rising aggressively.
    Funny how people on this blog think there’s going to be a crash and hard recession, but I bet if you guys ask yourselves whether you’ll get paid more this year, or do well this year, all of you would say ‘yes.’ How could it be that all of us will still have our jobs this year and do fine, but we’re heading into a recession and the world is coming to an end?
    I never said there’s no risk to investing in real estate. But, when you start buying real estate for a place to live, it’s your life, not an investment. Making money is just a bonus.

  41. Posted by Joel

    Power to the renters!!

  42. Posted by Amen Corner

    “Given this time frame, it makes sense for us to go Interest Only in our mortgage, which tilts the balance in favor of owning vs renting.”
    Maybe I’m missing something here, but why would it make much, if any, difference to the rent vs own equation? While your monthly payments would be lower with an IO loan, the lack of principal payment means that you will have less equity in the house than would be the case with a ‘traditional’ mortgage. So it seems to me the only difference is the opportunity cost (ie lost interest) of having more money tied up in the house.

  43. Posted by johnnyawe

    uhh – same exact tool has been available elsewhere on the internet for years?

  44. Posted by jeccat

    Actually, I played with the tool some last night again and found a few issues…
    * “renovation” costs are pegged at 0.5% of the value of the building ANNUALLY. That may make sense when you buy a fixer. But I suspect this figure is high for a newly renovated 1100 sq ft 2-bedroom. I certainly don’t plan to spend $3K renovating my just-renovated apartment this year, or in any year soon UNLESS I plan to sell it immediately AND I think the renovation will increase the price of the unit.
    * Likewise, “maintenance” is also pegged at 0.5% of the value of the building annually. I think $3K/year is a lot to spend on plumbers and electricians in a newly renovated building. If you have a good inspector and he thinks the property looks sound, why think you’re going to spend this kind of money? My guess is that 0.1% or 0.2% is more realistic for maintenance, especially when you factor in the HOA fee, which will cover a lot of maintenance.
    * This tool also assumes that you will pay $100 extra per month on utilities when buying rather than renting. NO apartment I have ever lived in covers gas and electric. If the HOA covers water and trash, these “utilities” will be hidden in the HOA fee as well.
    In MY case, if you change maintenance to 0.15%, take out “renovation” and utilities, and add in the HOA fee (in my case, $400/month) buying becomes better than renting MUCH more quickly– in 3 years with 4% growth, and in 7 years with 2% growth. Much more acceptable.

  45. Posted by Christopher

    One caveat on long-term financial planning, rent control and rental rates. I think a wise investor would keep in mind the distinct possibility that rent control statutes are subject to change. It’s not far outside the realm of possibility that the arbitrary date of June 1979 could be altered at the ballot box or via legislation by the Board of Supervisors. In the case of SF, the most politically likely outcome would be the inclusion of more units under the current statute. In progressive circles, I often hear about just such a strategy: move the construction cutoff date to post 2000. The key point is that one would be foolish not to consider this possibility in making an investment decision.

  46. Posted by dannyboy

    Neat model.
    Where do I plug in the value I receive as a homeowner from:
    – gardening and growing my own herbs and vegetables
    – playing video games and watching movies with volume at full blast
    – having a big ass garage where i can tinker with power tools
    – not having to climb a bunch of stairs to get to my flat?
    Basically I agree with Cant Think Of A Cool Name’s post — it ain’t ALL about the money. But then again, I may just be trying to justify my purchase.

  47. Posted by Amen Corner

    dannyboy, apart from possibly the gardening bit, you could do any of these things if you rented a house. I do agree, however, that there is owning a property is about more than just money.

  48. Posted by rut

    jeccat – regarding “maintenance” costs in SF, they can add up awfully quick. I recently had the exterior of a 2 unit (three story) building painted to the tune of $20k. I’m hoping it that it lasts 7 years. Don’t forget roofs don’t last forever, you may have a backyard which needs care, and sometimes those cement sidewalk squares buckle and need replacement. My neighbor just had to trench his entire sewer line from the backyard to the street…not fun nor cheap. My point is, even though you may not have the immediate expense of maintenance in your first or second year, you should be setting aside & accruing funds before your HOA hits you with a “special” assessment for some unexpected expenses.

  49. Posted by dannyboy

    Amen Corner – I suppose you are technically correct about my video game playing and garage tinkering habits.
    But doesn’t the cost of renting a full-blown house come a lot closer to an actual mortgage payment? … in which case buying becomes more attractive than renting *sooner* than if you are merely renting an apt or flat for $2K a month.
    My point was that if you’re paying rent at $2K a month, sure, it might make renting more attractive than buying. But you’re likely gonna be in an apt, not a house, in which case you sacrifice vid games and power tools.
    I’m totally generalizing here just to make conversation and procrastinate at work.

  50. Posted by fred

    Danny boy is right. A house gives you more freedom to pursue hobbies, keep pets, etc. Homeowners also have more pride and involvement in their communities. It is not just about living in a cube unit for x$ per month.

  51. Posted by MM

    fred –
    “Homeowners also have more pride and involvement in their communities. It is not just about living in a cube unit for x$ per month.”
    Come on now. Renters have no pride or involvement in their communities? That’s the kind of propaganda NAR likes to spread. Your whole response reeks of holier-than-thou prejudices as though renters were leeches on their community. Judging by my experience in SF, renters seem to have more than enough pride and involvement in their communities. Homeowners are not any more special than renters.

  52. Posted by huh

    Isn’t this site about the SF market? I mean, I haven’t. seen many places around that have big ass garages and are so far away from others that allow you to enjoy the prowess of your stereo system daily.

  53. Posted by Amen Corner

    “But doesn’t the cost of renting a full-blown house come a lot closer to an actual mortgage payment? … in which case buying becomes more attractive than renting *sooner* than if you are merely renting an apt or flat for $2K a month. ”
    Not in this area from my experience. Houses with market value “x” seem to rent for about the same as an apartment with market value “x”.

  54. Posted by [prime]

    The easiest thing to do is look at the options. It’s all about the TAX RATE. At the 20% default, it says it takes me 7-8 years to be better off renting based on 4% increases in rent and appreciation.
    Hellllo…. who is at a 20% tax bracket? People in the 20% tax bracket can’t afford $500K+. I put in my real tax bracket of 45%, and that breakeven comes to 1-2 years. People in high tax brackets benefit a tremendous amount.
    Go ahead, try it people. Put REAL assumptions like 35-45% tax brackets, 1.2% for real estate tax, 5.75-6% mortgage rates, 2% purchase costs, etc. Don’t forget to put in a real rental rate for the house you would buy too.
    Homeowning is so much better. And this is why blogs all around the world have popped up to denounce homeownership and call for armageddon. 🙂

  55. Posted by brick

    I dont think they mean tax ‘bracket’ and I dont believe you are paying more than %25 of your agi.

  56. Posted by renter

    “A house gives you more freedom to pursue hobbies, keep pets,”
    I presume you mean hobbies like “work”, and “job”. Do the current housing prices (where the median price of a home is affordable to only 8% of SF residents) leave room for much else?
    And I wasn’t aware that keeping pets was a privelege restricted to homeowners. Somebody’s going to have to explain that to my dog.

  57. Posted by fred

    Wow, I got flamed for my comment: “A house gives you more freedom to pursue hobbies, keep pets, etc. Homeowners also have more pride and involvement in their communities. It is not just about living in a cube unit for x$ per month.”
    I stand by my statement because homeowners have an equity position in their homes and renters do not. If a neighborhood goes down hill, the renter can move without losing equity. I did not state that renters have no pride or involvement in their communities or that homeowners are special.
    To the person who asserted that my statement was that keeping pets was a privilege restricted to homeowners, this is not what I said. However, let’s face it, many landlords of apartments and single family homes ban or restrict having pets, whereas a house (at least a single family residence on a lot) does not come with such restrictions.
    By the way, I rent now, but have been a homeowner and am soon to be a homeowner again, and I also have a dog.
    Thanks, I’m going to take a powder now.

  58. Posted by Jim D

    I stand by my statement because homeowners have an equity position in their homes and renters do not. If a neighborhood goes down hill, the renter can move without losing equity.
    I’m really going to need you to explain how that’s an advantage to home ownership.

  59. Posted by fred

    Jim D,
    I did not state that that owning a home was an advantage when a neighborhood goes downhill. In fact, you are right – it is not! My point is that a homeowner has more at stake when a neighborhood goes down and therefore would work more to improve it.

  60. Posted by asad

    that all depends on a huge “If the neighborhood goes down” a big if to put a big chunk of your equity into.

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