/biz/ - Business & Finance

I understand that on average buying is a better idea than renting, this has been discussed here very often.

But what if the rent to own ratio is extremely high in a city?

So right now I have a choice: Either buy a place for 700.000 Euro or rent the same place for 1500 Euro. My income is around 80k Euro and I have made it in crypto with around 500.000 Euro mostly in ETFs.

So if I rent: Around 1500 for rent each month, but around 500.000 * 0.03 = 15.000 a year in capital gains (very conservative estimate). So I am pretty much even with what I pay and what I earn.

If I decide to buy: All 500.000 are gone, I will still have a mortgage payment of around 1000 Euro per month + have to keep some money for reperations as well as taxes (let's say around 400 Euro a month all together),...

So capital gains + rent = 0

but capital gains + buying = 1400 a month in the red

Of course rent will increase 3% a year, but so will my capital gains. The only thing I am missing out on is the appreciation of value of the house/apartment. But honestly right now I would bet that real estate prices are overvalued, so I would not take that bet.

Am I stupid or am I missing something? Because in this specific situation (which I know does not apply in most of the US) renting actually does seem to be the better option.