We have a top-5% household income. Our net worth is in the millions. And we rent.
Not because we can’t afford to buy. Because we ran the numbers — all of them — and renting won.
But this post isn’t really about math. It’s about what you’re actually optimizing for when you choose where to live. Because the rent-vs-buy question is a Trojan horse. The real question is: what kind of life are you building?
Rent vs Buy: Key Facts
- Monthly cost gap: Renting can save $3,000-3,750/mo vs. buying equivalent property
- Hidden multipliers: Free pre-K, no city tax, employer-paid commute, and liquid down payment add $85K-110K/yr in total value
- Buying advantages: Forced savings, 30-year fixed rate lock, 5:1 leverage, $500K capital gains exclusion, tax deductions
- The real question: Not which is cheaper — what life are you designing?
The Setup
We live in a full-amenity building in a NYC suburb. Pool in summer, renovated gym, a resident lounge where my kids chase each other while I drink coffee ten feet away. We pay around $5,000 a month. My employer covers my commute to the city.
Our youngest gets free universal pre-K in our district. Next year, free pre-K4. Then free kindergarten. Three years of education that would cost $20,000-35,000 per year in the private market — handed to us because of where we live.
When people hear “renting,” they picture something temporary. Something you do before you graduate to real adulthood. But there’s nothing temporary about this. We’ve built a life here. My kids have friends in the building. We know the doormen by name. We have a community.
Let me walk you through how we think about this — and why you might think about it differently.
The Math (Start Here)
I built a rent vs. buy calculator for exactly this kind of decision. But calculators only capture what you can quantify. Here’s the full picture.
If We Bought the Equivalent
A comparable condo in our area — full-service building, pool, gym — would cost around $1,000,000. Here’s what ownership would actually cost:
| Monthly Cost | Amount |
|---|---|
| Mortgage (20% down, ~6.5%) | $5,050 |
| Property tax (high-tax state) | $1,800-2,200 |
| HOA (full-service building) | $800-1,200 |
| Insurance + maintenance | $300 |
| Total | $7,950-8,750 |
Plus $200,000 locked up in a down payment, earning nothing but the appreciation of one single asset in one single zip code.
What We Actually Pay
| Monthly Cost | Amount |
|---|---|
| Rent | ~$5,000 |
| Commute | $0 (employer-paid) |
| Total | ~$5,000 |
That’s roughly $3,000-3,750 less per month. $36,000-45,000 per year. And our down payment money stays invested in a diversified portfolio instead of trapped in drywall.
The Hidden Multipliers
The savings go deeper than the monthly spread:
No city income tax: Living in the suburbs instead of the city saves several percentage points of income — thousands per year on a high salary. The commute my employer covers is the bridge that makes this work.
Free public pre-K: Three years of pre-K through kindergarten at zero cost. At $25K/year private school rates, that’s $75,000 in savings per child.
Down payment stays liquid: $200,000 invested at 8% average returns generates roughly $16,000/year. That money is working, not sitting in a property that may or may not appreciate at the same rate.
Optionality: If our jobs change, if we want to move closer to a specific school, if an opportunity comes up in another city — we give 30-60 days notice. No realtor fees (typically 5-6% of sale price, which on a $1M property is $50,000-60,000). No staging, no waiting, no hoping the market cooperates.
Add it all up:
| Annual Advantage | Amount |
|---|---|
| Monthly cost savings | $36,000-45,000 |
| No city income tax | ~$10,000+ |
| Free pre-K (per child) | $20,000-35,000 |
| Employer-paid commute | $3,000+ |
| Investment returns on down payment | ~$16,000 |
| Total annual edge | $85,000-110,000 |
Read that again. We’re extracting $85,000-110,000 in annual value from this “renting” arrangement compared to the “obvious” move of buying a comparable home and paying for private preschool.
That’s not throwing money away on rent. That’s a financial instrument.
But Here’s Where It Gets Honest
I just made renting sound like a no-brainer. It isn’t. Because life isn’t a spreadsheet.
The Case for Buying (And I Mean It)
Forced savings that actually work. Most people don’t invest their “rent savings.” They spend them. A mortgage is a savings plan disguised as a bill. Every payment builds equity whether you’re disciplined or not. If you know — honestly know — that you’d spend the difference, buying is the better behavioral choice. The best financial plan is the one you’ll actually follow.
The 30-year fixed rate is a cheat code. You lock in today’s payment for three decades while inflation erodes the real cost. In year 20, your $4,300 mortgage payment feels like $2,500 in today’s dollars while rents around you have climbed 40%. Renters are perpetually exposed to market-rate increases. Owners are not.
Tax benefits compound. Mortgage interest deduction, property tax deduction (up to $10,000 SALT), and the $500,000 capital gains exclusion for married couples selling a primary residence. These are real, material advantages that the IRS built specifically to reward homeowners. They don’t exist for renters.
Leverage magnifies returns. A 20% down payment on a property gives you 5:1 leverage. If your home appreciates 3% in a year, your actual return on equity is 15%. No stock brokerage will give you that leverage at those interest rates on a principal residence. When housing goes up, owners win disproportionately.
Renovations build exactly what you want. The kitchen that’s designed for how you actually cook. The backyard that’s set up for your kids. The bedroom closet that fits your life. Renters live in someone else’s choices. Owners make their own.
And the Intangibles — This Is the Real Conversation
Here’s what no calculator captures and what I think about more than I’d like to admit.
The suburban dream is real and it’s beautiful. Kids running between houses with the screen door banging. Neighbors who watch your dog when you’re away and bring soup when you’re sick. Knowing the family three doors down for fifteen years. Block parties. Snow days where every kid on the street is outside. A backyard with a firepit where the adults drink wine on Friday nights while the kids catch lightning bugs.
That’s not a fantasy. I grew up around it. Millions of families live it. And it is genuinely wonderful.
Ownership roots you. When you buy, you invest — not just financially, but emotionally — in a place. You care about the school board. You show up to town meetings. You know the mail carrier’s name. You plant trees you won’t see mature for twenty years. There is a deep human satisfaction in that rootedness, and decades of research back it up: homeowners report higher life satisfaction, more community engagement, and stronger social ties.
Your kids remember the house. They remember the height marks on the doorframe. The tree they climbed. The crack in the driveway where they learned to ride a bike. These aren’t just sentimental details — they’re the architecture of a childhood. Renting means you might move. Owning means you probably won’t. And stability has value for kids that shows up in school performance, friendships, and emotional security.
I feel the pull of all of this. I do.
What I’ve Learned Living the Other Side
My kids play in a building playroom instead of a backyard. They ride scooters in the parking garage when it rains. Their best friends live a few floors away, not a few houses away.
Is it different from the suburban version? Yes. Is it worse? I genuinely don’t think so.
My kids don’t know they’re “missing” a backyard because they’ve never had one. They know the concierge by name. They race each other to the elevator. They have a standing playdate in the lounge with other families from our building. We have community — it just looks different.
And I notice something about our setup that I think matters: the proximity is tighter. In a building, you can’t avoid your neighbors. You share walls, hallways, elevators, laundry rooms. My kids are learning — without any curriculum — how to share space, read social cues, and navigate a diverse community of people who don’t all look or live like us.
In a cul-de-sac, you choose your neighbors by price point. In a building, you get whoever’s there. I think there’s value in that, especially for kids.
The Framework I Actually Use
Forget rent vs. buy as a binary. I built an interactive scorecard based on the five dimensions I actually evaluate. Try it — your results will be different from mine, and that’s the point.
What Fits for Me
I’m not anti-homeownership. I’ll probably buy eventually — when the math changes, when the kids are in a school we want to stay at for a decade, when our income streams are diversified enough that locking up $200K doesn’t compromise our runway.
But right now? An approximately $5,000/month rental with free school, no property tax, no maintenance headaches, a pool my kids think they own, and $200K earning returns in the market instead of sitting in a down payment — this is the optimized position.
The suburban dream with the big backyard and the neighborhood block party? It’s beautiful. And for many families, it’s the right call. Not because the math works — often it doesn’t — but because the life works. Because they want roots. Because their kids need that specific kind of stability. Because community for them means a street, not a floor.
There is no universally correct answer. There is no “one weird trick” that makes renting or buying always win. There is only what fits your numbers, your family, your stage, and your definition of a good life.
I’m sharing what fits for mine.
Frequently Asked Questions
Is renting really better than buying on a high income?
It depends entirely on your situation. In high-cost, high-tax areas, renting can save $30,000-100,000+ per year when you factor in property tax, maintenance, HOA fees, opportunity cost of the down payment, and benefits like free public pre-K or employer-paid commutes. But buying offers forced savings, leverage, tax benefits, and long-term cost certainty that renting cannot match. Neither is universally better.
How do you calculate the true cost of buying vs renting?
Go beyond mortgage vs. rent. Add property tax, HOA fees, insurance, maintenance (budget 1-2% of home value annually), and the opportunity cost of your down payment (what it would earn invested elsewhere). For renting, include annual rent increases (typically 3-5%). Our rent vs. buy calculator runs this full comparison over any time horizon.
What is the opportunity cost of a down payment?
If you put $200,000 down on a home, that money is no longer earning investment returns. At an average 8% annual return in a diversified portfolio, that is roughly $16,000 per year in foregone gains. Over 10 years, the compounding effect means you could miss out on over $230,000 in portfolio growth. This is one of the largest hidden costs of homeownership.
When does buying make more financial sense than renting?
Buying typically wins when: you plan to stay 7+ years (amortizing transaction costs), mortgage rates are low enough that your fixed payment undercuts rising rents within a few years, the down payment is less than 20% of your net worth (low concentration risk), and you would not otherwise invest the savings from renting. The behavioral benefit of forced savings through a mortgage is real and matters more than most spreadsheets show.
Should I buy a house if I have a high income but might relocate?
Probably not. Selling a home costs 8-10% in realtor fees, closing costs, and transfer taxes. On a $1M property, that is $80,000-100,000 gone. If there is a meaningful chance you relocate within 5 years — job change, career pivot, family needs — renting preserves your optionality at a fraction of that cost. Match your housing commitment to your actual time horizon, not a 30-year mortgage timeline.
Want to run your own numbers? Try our rent vs. buy calculator — it factors in opportunity cost, tax benefits, and appreciation so you can see the real comparison for your situation.