Opportunity Cost When Buying Property

In a recent podcast, British advertising guru Rory Sutherland said,

I made the decision to underspend on property on the grounds that nearly everybody else was effectively maxing themselves out. The default behavior of housing was to buy as much as you can borrow. That assumes the greatest return on happiness comes from property expenditure. No one really looks at the opportunity cost. If you’ve got a massive mortgage there’s a holiday you can’t take there are children you can’t educate.

Hat Tip: The Waiter’s Pad

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