As rent inflation goes up by inflation, but also property tax increases on home owners also go onto renters
It very much depends. The last place I rented I didn't have an increase in eight years because we were great tenants and the entire rent payment was less than the interest portion of a mortgage on the property would have been had I tried to buy it.
maintenance of properties goes into rent as well... So take out maintenance and taxes since both pay that
The point was most people don't include maintenance, particularly large and intermittent expenses like HVAC and roofing, when they compare the costs of owning vs renting. It's baked into rent but hits you on the back end as an owner and isn't part of your superficial monthly payment.
Taxes are not necessarily comparable depending on where you live. In CA, for example, property tax is set as a percentage of sale price at the time of last title transfer, which gives older title-holders a much smaller nut to pass on to tenants than a more recent buyer would pay.
I don't see a scenario where renting gives you extra equity/capital to be investing outside what you'd make on your down payment amount
Right, the difference is getting an extra 4-5% return on the down payment, plus your ongoing equity contributions. I'm not saying that renting gives you "extra" money to invest, just that for comparability you need to be looking at a rent figure that's about equal to interest + tax + insurance + maintenance, making it less than the equivalent cost of ownership by virtue of not counting the equity contribution, and then take that and invest it. Unless you're counting all those factors (and more), the comparison isn't apples to apples.
Just to pull some bogus round numbers out of a hat, let's pretend you're looking at a $3k mortgage plus $200/mo long term average maintenance. If a quarter of the $3k goes to equity, the equivalent rent might be $2450 (3000 * .75 + 200), and you should be investing an additional $750. (So $3200 outlay in both cases.) Compare the properties you can access under those two conditions. In some places and times you'll be able to rent for $2450 what you can't buy for a $3k payment. I've had three such houses over my adult life, admittedly not since 2020.
This is a simplified case and you'll need to compare relative returns on the down payment/equity, rent increases vs inflation, cost and frequency of moving, real estate transaction costs, etc. There are a lot of factors and this is why calculators like the one I linked are useful.
Of course these are only the strict financial considerations. It's worth perhaps a significant amount of money to have the stability, security, and customization that come with owning property. Doing this math will let you put a number on how much that's worth to you.
But also they are even re-introducing that lovely concept of 1% down mortgages which ends up being little more than "First, last months, and a security/pet deposit" in some cases.
This is just stupid and we all know it.
