Renting vs Buying a Home: How to Decide
Why Hacker News recommends it
Cited in housing threads for his rule-of-thumb rent-versus-buy analysis and the view that it is often a financial wash.
What it is
Ben Felix explains how to decide between renting and buying a home, weighing financial and non-financial factors. He argues that renting is often as good or better than owning, both financially and for well-being.
Recommended by 2 HN commenters across 2 different months, 2022 to 2026.
What Hacker News said
Recommends senko · 2022-12 · on “Against Homeownership”
> it's very hard to make a financially logical argument against sensible home ownership. No it isn't. Ben Felix has a great video talking about this: [this video] We can argue which is better in a specific situation, but there's definitely an argument for renting other than "people buy too big".
Recommends _huayra_ · 2023-09 · on “Renting vs. Owning a Home, by State”
> But if you live in the house, then just considering appreciation and expenses leaves out a huge benefit: you have a place to live without spending any other money. What matters at the end of the day are the irrecoverable costs. When renting, it is just the rent. When owning, it is certainly not free: you're paying other irrecoverable costs (e.g. out of PITI+HOA, everything but P is irrecoverable; add on separate costs for when you must pay for repairs and it gets steeper). Sure, you have stability and can write off mortgage interest when you own (although the latter is an extremely unfair policy), but unless one is absolutely sure that one can stay in the home for close to ~7 years (the ro
Cites throw0101a · 2022-05 · on “Inflation is differential and restructuring (2021)”
> I find it interesting that house prices are kept out of inflation. > The reason, as I understand it, is that shelter costs are kinda funny in how they are added to this statistic. Housing prices are not considered in the CPI ("cost of living") because houses are mostly an asset: > House prices are an interesting case. Houses are considered capital investment by the [US] BLS. So, when the value of your home increases that's a good thing as you didn't consume the house. In other words, you don't need to replace the house. Consumption goods are different in that you need to replace the thing you bought. Inflation is very bad for consumption goods because it costs you more to replace that thin
Cites throw0101a · 2022-05 · on “Why the government took home prices out of its main inflation index”
> You don't need to purchase a home - but historically - if you did - you've been much better off financially. [citation needed] Per the The Credit Suisse Global Investment Returns Yearbook 2018 , the global return for real estate from 1900 to 2017 was 1.3%, while stocks returns 5.2%: * [LINK] Rent is often cheaper than mortgage payments, and is very more often cheaper than mortgage payments plus the cost of maintaining a home. If you take the difference and investment you can have just as must equity in a few decades. Preet Banerjee goes over the math in this ten minute video: * [LINK] He rents: * [LINK] If you want to know when it makes financial sense, the "5% Rule" by Ben Felix is a dece
Cites throw0101c · 2026-05 · on “The Cost of Owning a Home”
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: [LINK] * 2025a: [LINK] * 2025b: [LINK] * 2021: [this video] * 2019: [LINK] 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: * [LINK]