<prompt> Human: I currently live in Seattle where it is well known that the housing market is a sellers paradise...Because of that, I have been seeing a few articles saying that renting is better than buying in this environment. Many times, it has a scale asking you housing price and rent prices and coming up with a time period it becomes better to buy. Example is: If you plan on living here for 4 years and 8 months, it is better to buy a house at 500,000 than it is to rent at 2,500month.This thought process does not make sense to me. My calculations show that buying will always be better off. Here is an example of my thought process, if you could tell me where I am going wrong that would be great! Lets start with a few statements:Time in Seattle: 2 yearsHome Value: 500,000 Down Payment 5: 25,000 Morage: 3,000 month PMI without 20 down: 300month Rent Cost: 2,000month --- --Buying-- --- Total Morgage Paid Off: 25,000 Year 1 Total Morgage Paid Off: 61,000 Total towards PMI Insurance: 3,600 House Value 6 expected for 2018 530,000 Year 2 Total Morgage Paid Off: 97,000 Total towards PMI Insurance: 7,200 House Value 6 expected for 2018 561,800 Analysis Total money lost from PMI: 7,200 Total money gained: 61,800 No money lost from morgage payments... will be returned unless house loses value Profit: 54,600 --- --Renting-- --- Lets say I toss the 25,000 and 1500month not going towards downpaymentmorgagePMI into a high stock investment with good gains 10 Year 1 Total money paid towards rent: 24,000 Total money paid towards investment: 43,000 Total Interest on investment Im taking the 10 against full amount to simplify: 4,300 Total investment: 46,300 Year 2 Total money paid towards rent: 48,000 Total money paid towards investment: 58,300 Total Interest on investment Im taking the 10 against full amount to simplify: 5,830 Total investment: 64,000 Analysis Total money lost from rent: 48,000 Total money gain from investments: 10,130 Profit: -37,870 From this it is obvious that buying is completely smarter... how in the world are people saying that only after a certain amount of time 4 years buying will be better than renting... Any help would be nice! :  <response>: Youre failing to take into consideration that most of your 3,000 mortgage payment does not go towards principle. Youre paying interest, insurance, and taxes out of this. At a 4 interest rate, the interest paid in the first year on a balance of 475k is 19,000. This money is not going towards repaying your loan. Neither is the amount paid for property taxes or insurance. On a long term buying usually ends up being better than renting, but to claim that it is always better is asinine and uninformed. 