Life & Career · 租房与买房（Rent vs Buy） · Updated 2026-10-25
What Is Rent vs Buy?
Definition
The financial comparison: owning's implicit monthly cost = forgone interest on equity + maintenance + depreciation − expected appreciation; renting costs the rent. The international rule of thumb: at monthly rent-to-price 1:200-1:300 (4-6% gross yield) buying wins; top-tier Chinese cities run 1:500-1:700 (1.7-2.4%), below mortgage rates — rent covers barely half the interest. Non-financial factors remain: hukou and school district tied to ownership, lease insecurity, renovation freedom, and liquidity risk. For anyone likely to move within 5 years, renting and investing the difference almost always wins.
Formula
Ratio = monthly rent / price; annual yield = ratio × 12
Worked Example
A 5M home renting 9,000/month: ratio 1:556, yield 2.16%. The 1.5M down payment at 3% bonds earns ~3,750/month, plus mortgage interest ~12k — total holding cost ≈16k/month versus 9k to rent.
Common Misconception
"Rent pays the landlord; a mortgage pays me" — early mortgage years are mostly interest (~60% in the first 8 years of a 30-year loan); interest pays the bank just the same. And "prices only rise" — several cities still sit below their peaks since 2017; opportunity cost of the down payment and liquidity discount belong in the math.
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