doofrat – that is correct. It was just an example to show how important rent is when calculating the quality of the investment. You can’t just use the interest rate of the loan and the rate of growth of the house. By the way, I included no down payment in WORLD 1 – 100% financing was assumed to simplify the example. But if you do assume a down payment, of course you would have to look at the growth of that money.
i.e. your actual mileage may vary – do the numbers.
Also, as you say, if the asset you need is depreciating and you have an opportunity to buy later at a lower price, then do so.
