Grant Cardone, real estate titan and founder of Cardone Capital, recently sparked controversy with his candid views on homeownership. Speaking on “The Money Mondays Podcast,” he stated, “If renting doesn’t make sense at half of what it costs to pay the mortgage, how does the mortgage make sense, which is just a fancy bullsh*t word for paying rent for 30 years to the bank.”
Cardone, whose firm boasts a portfolio of $4.5 billion in assets, including multifamily properties and commercial spaces, has long been a critic of buying a primary residence as an investment. He argues that the financial burden of a mortgage often overshadows the perceived benefits of homeownership.
“Let’s say it’s in Orange County where the house is $800 grand,” Cardone said. “You’d have to sell the house for $2 million just to pay the interest back. Not property taxes, not maintenance, not the wear and tear. … That’s the house you’re stuck in. That is the great American dream as a homeowner.”
This perspective challenges the traditional view of homeownership as a financial milestone and raises an important question: Is renting a smarter financial move than buying?
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Renting A Home And Investing Elsewhere
The debate between renting and buying is complex, especially in the current housing market. The average home price in the U.S. during the third quarter was $513,400, with mortgage rates at 7.87% for a 30-year fixed-rate loan. The average down payment of 14.7% translates to $75,470.
In contrast, renting has a lower barrier to entry, with an average monthly rent of $1,354 in October and an initial payment of around $4,062 to cover the security deposit and first and last month’s rent.
When the numbers are crunched, with today’s mortgage rates and private mortgage insurance (PMI) for down payments below 20%, the initial mortgage payments amount to $3,356 for the first 71 months and…
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