So much written about housing is just... Wrong. And I don't mean factually inaccurate. I mean based on false premises.
Owning your own home serves several purposes:
1. Security
2. Stability
3. As a hedge against inflation
4. As a hedge against market forces
That doesn't mean buying is always a good idea. Clearly or isn't. Like don't but in a town where 70% of the adults are employed by the local coal mine, for example.
Here's how I like to think about it: you are never out of the housing market. By not owning you have a large short position in real estate. Given that rents eventually track prices, if prices go down you benefit (you're rent will eventually go down and you didn't lose capital). If prices go up you lose. You missed a gain and your rent will go up.
Given that, you buy your house to remove risk of local changes to your detriment.
Owning your own home serves several purposes:
1. Security
2. Stability
3. As a hedge against inflation
4. As a hedge against market forces
That doesn't mean buying is always a good idea. Clearly or isn't. Like don't but in a town where 70% of the adults are employed by the local coal mine, for example.
Here's how I like to think about it: you are never out of the housing market. By not owning you have a large short position in real estate. Given that rents eventually track prices, if prices go down you benefit (you're rent will eventually go down and you didn't lose capital). If prices go up you lose. You missed a gain and your rent will go up.
Given that, you buy your house to remove risk of local changes to your detriment.