Nicole Lapin

So let's talk about a specific area.

We pulled the numbers for LA and a lot of metro areas and,

For comparable homes, rent is 30% to 40% lower than a mortgage payment.

So in LA right now, the median rent, $3,000 versus a mortgage, $5,000.

So we talked about the opportunity cost.

If you invested just the down payment and never put in another dollar, you would still beat the return on an average home.

But let's say you added that delta of what you're saving on your rent versus a mortgage and all of those costs that you never get back.

So $2,000 a month.

With no down payment, you would have $4 million at the end.

of 30 years if you signed up for a 30-year mortgage.

If you did both, you'd have $5.7 million.

If you took the $100,000 down payment and the $2,000 that you're saving every month by renting and not buying, then you would make almost six times as much money as you would have spent buying.

What do we say to that?

If somebody will spend that, I mean, ultimately a property is only as valuable as somebody's going to spend on it.

I definitely don't have a crystal ball for sure.

But over time, the S&P 500, so the overall index, has yielded 7% to 10%.

Over time, I'm definitely not in the driver's seat there.

But historically, it allows me to diversify.

So renting, I don't believe, is throwing away money.

It's buying you the option to invest elsewhere where you can also have potentially higher returns and your risk is spread out.