Are you factoring in the value of a living space in this calculation, the rent that the house generates?

When you live in your own house, it's called "implicit rent" but when you actually rent it out at market rates it's just called "rent."

There are a few housing markets where what you say will be true, but it's not true of most of the US by any means.

No, I did not factor in implicit rent, I was looking at from the point of view of it being an investment.

Renting a place out has other costs. Tenant damage, tenants who don't pay rent, tenants who sue you (and landlords always lose), lawyer expenses, time when it sits vacant, vandalism, advertising, having to deal with the tenants, etc.