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Why “Cash Offers” are not always better than a Mortgage (The Opportunity Cost)
There is a common myth that paying cash for a house is always the smartest financial move. While it avoids interest and makes you a strong buyer, it ignores the “Opportunity Cost.”
If you have $400,000 in cash, you could buy the house outright and save 6.75% in interest. But if you take a mortgage at 6.75% and invest that $400k in a diversified portfolio (historically returning 7-10% annually), you might come out ahead due to compound growth and liquidity.
Plus, mortgage interest is often tax-deductible (up to a limit), while cash sitting in a house is illiquid and hard to access in emergencies.
What’s your take? Is “all-cash” always king, or does leverage still make sense in 2026?
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