Nicole Lapin

But we can agree that in the short term, it doesn't make sense because there's a five to seven year breakeven period, right?

So if you're not sure you're staying there as your primary home, it doesn't make sense because you're spending so much in interest, especially in the beginning.

We can do some easy math if you would like.

Let's say you buy a $500,000 starter home and you think you're going to get a bigger, better place in five to seven years.

You put 20% down.

Okay.

So you put 100K down.

And after five years, you've spent $133,000 just on interest and only $26K on principal.

If you took that $100,000 and you put it in the market, instead, you'd have $160,000.

So the real cost is an opportunity cost, especially in the short term.

I mean, that's the only way to make this comparison, right?

So over time, real estate has yielded on average, I know it's very market specific and your properties are special, but 4.5% a year.

Over time, the S&P 500 has yielded 10%.

So if you're looking at an apples to apples comparison, you're going to make more if you take that money and you invest more.

in the stock market.

So if you invest that 100K and never put another dollar in your investment account over that 30 year mortgage, you'd have $1.7 million.

On a $500,000 house with the interest, you're spending close to a million dollars for that house.

So it has to grow a lot.

And oftentimes it doesn't.

I'd love for you to answer.