Buy or rent: the non-immigrant's dilemma

One of the common queries that I get is from non-immigrants who don't yet know whether they are going to make US their permanent home. They typically have a moving window at the end of which they intend to return to their home country. As the number of years of stay increase, the n+1 syndrome takes effect. Before long they have been in the same place for over a decade, renting all the time, when they could have partaken in their specific region's real estate boom.

This is a very common scenario in North California, especially silicon valley. The typical non-immigrant here tends to be a professional on an H1-B visa, reasonably well off, and here for at least 6 years, at the end of which he or she may have to return for at least 1 year before coming back to the US for 6 more years (unless they managed to get into the green card circuit and in an oftentimes endless wait for permanent residency). This demographic is very special. Very analytical, math whiz at times, well educated folks just unsure of what to do about real estate.

In this blog entry (which will keep on getting updated as I get time), I'll discuss the examples of a few such folks from my friends and clients and how we got around this dilemma. In doing so, I intend to outline a process which can be followed to figure out a good decision. Of course, all of this could be secondary because a lot of people buy homes for emotional and family reasons. But silicon valley tends to be different with its very high housing costs, and relatively modest rents. The financial factor becomes very important in this case.