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Say your rent is $1,500/month. That adds up to $18,000 per year. That means you'll need at least $450,000 in the bank, assuming a 4% APY, to earn that $18,000 in interest.

So, you'd need a pretty large amount of capital to start with to make this work.

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It gets worse when you factor in that the interest is taxed, whereas Owner's Equivalent Rent is not.

given that a 2 bedroom apartment in nyc _starts_ at 2 million

you can see how the numbers start evening out :)

I don't see how that changes the fundamental issue. You have to have a huge amount of capital to even get this idea off the ground. Say your rent in nyc is $3500/month, that means you'd need around a million dollars in your savings to get started.

right, but you are unable to even think about buying in nyc without two

once you're in a position to buy, it becomes more convenient to rent until things 'even out'

Except you don't need 2 million or even 1 million upfront to buy. That's what a mortgage is for. To pull off your plan, you would need at least a million upfront.

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