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Comment by throw0101c | Hacker News Reader

Ben Felix, a Canadian portfolio manager that does personal finance videos and podcast, has been arguing for years that rent versus buy is often a wash financially, and that you should make the decision for non-financial resasons.

* recent 2026 video: https://www.youtube.com/watch?v=aU7v87EhDBI

* 2025a: https://www.youtube.com/watch?v=j4H9LL7A-nQ

* 2025b: https://www.youtube.com/watch?v=lBG-g1CKfgs

* 2021: https://www.youtube.com/watch?v=q9Golcxjpi8

* 2019: https://www.youtube.com/watch?v=Uwl3-jBNEd4

The 2019 video goes over a handy "5% rule of thumb": start with the purchase price of home, take 5% of that: if your rent is less than that, better numbers-wise to continue renting (and investing the difference); if your rent is more, probably better numbers-wise to buy/own.

The company he works for created a tool to examine the numbers:

* https://research-tools.pwlcapital.com/research/rent-vs-buy

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In a perfectly efficient market that's what one would expect. It's pretty likely that the housing market has plenty of inefficiencies but it probably varies by region and people would need to compare rent and sale prices in their area.

If you can buy low and sell high it’s worth it. Especially if you’re positioned to buy when you can lock in low mortgage rates. Above 6% you might be better off putting your down payment into the stock market and renting.

It’s also more likely that you’ll feel good about spending money to improve the home if you think you can get the money back when you sell. (And then you get to live in a more pleasant place for years)

> Especially if you’re positioned to buy when you can lock in low mortgage rates. Above 6% you might be better off putting your down payment into the stock market and renting.

"Locking in" a rate for multiple decades is mostly (only?) an American thing:

* https://www.tandfonline.com/doi/full/10.1080/15214842.2020.1...

* https://www.investopedia.com/why-your-30-year-mortgage-exist...

* https://www.cnbc.com/2024/05/07/why-the-30-year-fixed-rate-m...

* https://www.deeded.ca/blog/why-canada-doesnt-have-30-year-fi...

While a ≥20 year amortization period is common, the mortgage term is generally shorter (2-5, 10 years) is most other places.

In italy not only you can lock it, you are allowed to change bank for lower rates (surroga) without any penalty

Also true in the US, the term of art here is "refinancing". Just about every homeowner I knew during Covid refinanced and now has a rock-bottom interest rate on their mortgage.

The downside of doing that is you end up "locked in" to the property too. They now have a strong disincentive to sell, because they'll lose that sweet sweet interest rate and relatively low payment. I'm unsure what the broader effect is on the market.

It's okay to do things that don't maximize your return.

Everybody is so obsessed with squeezing out the maximum amount of money from everything, it's exhausting.

Squeezing out the expected amount of money, making it even more exhausting.

Guessing what your yearly house-owning costs will be, and what the market will be when you sell, is in the realm of crystal ball scrying. Sure, you might be able to guess "reasonable" estimates, but individual instances aren't necessarily near the mean value.

> If you can buy low and sell high it’s worth it.

Or, hear me out: buy low and rent high.

Is the 5% rule for total rent per year?

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