rentcontrol

Unless all of your money was in Google stock options, in the example mentioned earlier, one could buy a house and have Google stock options, so...

The difference is that with average appreciation rates in California, when they sell they get all of their money back (minus fees, of course). You? Well, you had a place to stay.

As long as appreciation + inflation over the period you stay in a house you buy is greater than your interest rate, buying a house is effectively free (minus the downpayment). People bring up maintenance, however this is already taken into account with rental price increases, vs. a fixed 30 year mortgage. Maintenance is an overplayed expense, honestly.

EDIT:

I can't reply to the children comments, but I just want to say that the situation mention is absurd.

1. 2.7M worth of 1985 S.F. property would be entire neighborhoods and give you more than 6%. Forget houses, 2.7M in 1985 would buy you acres of prime real estate.

2. Even if it did not, it's not necessary to put down 20% on a house.

3. Investing and purchasing a house are not mutually exclusive strategies.

4. Overall, over 40 years buying will always be better.

Is it actually too high? It sounds like it's just right to me. Clearly you're paying the premium to live close.

Personally, I ask my friends who complain about rent why they just don't change what they want, e.g. roommates, worse quality, further away, worse amenities, etc. and generally they say they want it all.

Well, unfortunately to have it all you have to pay. Paradoxically, those who want to live in the city will want to enjoy the amenities, which cost money. Money that will take them that much further from buying a house. Clearly, from the behavior they must not want a house that much.