Hedgeye Podcasts Hedgeye NexGen: Building Wealth for Young & New Investors | Episode 15 | Owning vs. Renting
May 17, 2025
The podcast dives into the ongoing debate between owning a home and renting, highlighting the financial pros and cons of each option. It emphasizes current challenges like rising mortgage rates and wealth inequality. Discussions also cover the impact of economic factors on housing affordability, and how personal circumstances influence this major decision. Listeners gain insights into making informed choices about real estate and investment strategies in today's market, including the advantages of renting as a potential wealth-building strategy.
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Stocks Outperform Homes Historically
- Stock market returns doubled home price appreciation since 2000 with about 10% yearly versus 5%.
- Owning a home is appreciating and not a depreciating asset as some claim.
Housing Affordability Hits Record Low
- Current housing affordability index is at an all-time low due to flat incomes and rising prices.
- Affordability similar to 1986 despite mortgage rates being lower now shows income limits.
Income Gap Limits Homebuyers
- Median income about $80k is far below qualified income of $121k needed for median-priced home.
- This huge gap shows many can’t afford average homes despite mortgage rates.