No one else to ask about this thought.

[Gamal R.]

Hello everyone.

I was just thinking would you ever consider renting the house you live in while owning investment properties. In other words I am considering living in a prestigious area I cant afford to buy but could afford to rent. In the mean while continue owning my investment properties? I would like to hear what the investors think, I always said I would never rent and make someone else rich but I own my own rentals it doesnt seem so bad if I rent myself. Reason for doing it would be better lifestyle and schools for children. Please let me know your rationals and reason behind them. thanks

[Jon Holdman]

You can rent money to own a house (i.e., have a mortgage) or you can just rent the house. IMHO, a house you live in is just an expensive doo-dad. So, work the math and see which costs you less for the doo-dad you can afford.

Now, for a lot of people, a home is a forced savings account. You have to make the payments and if you hang on long enough, you have a nice nest egg at the end. If you work math, though, its rarely your best alternative. But a lot of folks will spend everything they can and if they have a lower net rent payment than mortgage payment, they will just spend the extra. If you have the discipline to invest what you're saving, I think you can do better. Rental properties are a good alternative.