As an example, San Francisco currently has an estimate buy-to-rent ratio of 30, which means it would take 30 years of rent to pay for purchasing the same piece of real estate. This supposedly means that it is more efficient to rent an apartment in San Francisco than to buy one outright. But is this "common wisdom" really true, at least for the buy-to-rent ratios currently seen in the US? Sure, it might take 30 years for your investment to pay off in San Francisco, but unlike the guy who spent 30 years in rentals you now have a private piece of property. Not to mention that San Francisco remains a popular city and land prices are likely to continue increasing there for the foreseeable future, so your resale value would be higher when adjusted for inflation.
How high does the buy-to-rent ratio have to be for renting to be a wise decision in the long term?