Rentvesting VS Buying Your Own House

?✅ #RENTVESTING vs BUYING YOUR OWN #HOUSE. I have heard so many times how renting + investing is better than owning your own property. Is that so? I do my maths and here is my finding. NOTE: I’m not a financial adviser, so please take this as a general info only.

Assumptions:
– Rent and costs do not go up at all
– 8% capital growth
– 80% borrowing

? OWNING YOUR OWN HOUSE
Purchase price: $400,000
80% borrowing: $320,000
5% purchase costs: $20,000

Expenses
————–
Water rates/year: $2,000
Council rates/year: $1,000
3% interest/year: $9,600

Expense/year: $12,600
TOTAL EXPENSES 5 YEARS: $63,000

Income
————-
Rental income = $0

Equity
—————
Property price after 5 years: $587731

✅✅ NET worth 5 years: $587731 – $320,000 – $63,000 – $20,000 = $184,731

? RENTING + INVESTING

Renting $300/week of 52 weeks * 5 years = $78,000
Investment property purchase: $300,000
80% borrowing: $240,000
5% purchase costs: $15,000

Expenses
————–
Water rates/year: $2,000
Council rates/year: $1,000
4% interest/year: $9,600
Property Manager 10%: $9,100

Expense/year: $12,600 * 5 years
TOTAL EXPENSES 5 YEARS inc PM: $72,100

Income
————-
Rental income @ $350/week * 5 years = $91,000

Equity
—————
Property price after 5 years: $440798

✅✅ NET worth 5 years: $440798 – $240,000 – $78,000 – $15,000 + $91,000 = $198,798

CONCLUSION
It looks like Rentvesting is the winner here (assuming the parameters above).

The biggest point of difference here is how with rentvesting you are actually generating income through rental.

This is obviously assuming 8% growth every year, which is not the case. In reality, property goes in cycle, but long term, it averages 8% growth.

The benefit of owning your own place is obviously your ability to do whatever you want with the house. Having said that, financially, looks like you are better of with renting + investing? Thoughts?