Food for thought. Buy a house or rent? I would say right now that I would go for renting over buying.
https://leofinance.io/@ph1102/buy-rent-or-rent-to-buy
Posted Using LeoFinance Beta
You are viewing a single comment's thread from:
Food for thought. Buy a house or rent? I would say right now that I would go for renting over buying.
https://leofinance.io/@ph1102/buy-rent-or-rent-to-buy
Posted Using LeoFinance Beta
I rent. Buying is a bad idea for a few reasons in my opinion.
we are in a bubble with housing. It might go higher but will end up having a big pullback.
technology is going to change the future cost to build. People getting into 30 years mortgages might have an asset that costs a heap load more than what future building might cost.
we are seeing a popping of the artificial urban real estate bubble. This could have huge impacts on prices as people are freer to live where they want and still find sustenance.
Posted Using LeoFinance Beta
I think the popping is generally only happening on the retail sector right now and I don't think the urban area will be touched for a while. It will be whenever the mortgage crisis takes place and the fed wants the market to go down.
But I do think it will go down eventually.
Posted Using LeoFinance Beta
Urban areas are already seeing a great deal of exodus and prices in major cities are collapsing.
We will see how it all turns out but I will not be surprised if we see cities as undesirable in 10 years.
Posted Using LeoFinance Beta
I think this will primarily depend on whether or not the work from home takes off. I think it will but if the going back to work crowd works out, then the cities will still be filled.
Posted Using LeoFinance Beta
That is true and certainly an area of uncertainty. However look at who is in cities. Companies such as banks and insurance companies occupy a lot of real estate in cities. These are two areas that are under attack in my opinion.
Even the other discussion about lawyers, they occupy a lot of city space in the US. If they are seriously reduced, that will free up a lot of space.
Posted Using LeoFinance Beta
Right now its the small offices that are in demand. As things go virtual I expect it to go down as well. But the problem is if prices will go down or will the reach buy up everything or are we forced to rent from the rich?
Posted Using LeoFinance Beta
They do that with market cycles anyway. Who do you think buys all the stuff from the banks when the real estate market crashes and people are foreclosed upon?
The game is still the same. This way, the transfer of wealth is at least not taking place.
Posted Using LeoFinance Beta
This is true even in India and there are hell lot of lawyers here lol but still the amount of pending cases is huge , like literally , very very huge .
Posted Using LeoFinance Beta
That is true , the cities in India is filled up and there is literally no more space for new buildings . The WFH culture can help Indian cities to decongest a bit .
Posted Using LeoFinance Beta
I also like to have "Mobility" by renting. If I decided to get the hell out of the country next week, it wouldn't be a lot of trouble because I don't have a large portion of my money "stuck" in a house right now.
Posted Using LeoFinance Beta
Same here. Being tied to a property does take away some of that freedom. It takes time to liquidate plus the expenses involved eat up a bit of the sale.
Posted Using LeoFinance Beta
Many learned that the hard way in the last economic collapse. They could not relocate easily in search of jobs since they were tied to a geographic area with the house.
Posted Using LeoFinance Beta
During your service years , did you work overseas ?
Posted Using LeoFinance Beta
Yes. Quite a bit actually.
Posted Using LeoFinance Beta
Exactly , the concept of "stay at one place" is becoming obsolete nowadays , atleast in my opinion .
I would rather spend money on something else than house .
Posted Using LeoFinance Beta
I rent because I live in an expensive city and I want to move to another city eventually, but I would like to buy/build my own house in the near future
Posted Using LeoFinance Beta
Building is also an option... I don't really want to do that but my dad is crazy about it. He has built 3 houses in his lifetime and I don't doubt he will build a 4th one one day
Posted Using LeoFinance Beta
Lol , for investment purpose or he just likes it ?
Posted Using LeoFinance Beta
He just really loves it!
He loves doing the calculations, drawings all that stuff
Posted Using LeoFinance Beta
That's good to hear hehe . Gotto have some passion in something right ?
Posted Using LeoFinance Beta
Make sure you go the 3D printed route so its cheaper. You just got to buy the land I guess.
Posted Using LeoFinance Beta
I'll obviously opt for the most cost effective method :)
Posted Using LeoFinance Beta
That's good to hear but where do you feel comfortable building you house ? Outskirts or in the city ( provided you get the land in the city lol )
Posted Using LeoFinance Beta
in a nice suburb not far from the city would be ideal :) not a fan of long commutes :P
Exactly :) That's ideal .
Posted Using LeoFinance Beta
Totally agree with you on this one . That is why I hesitate a lot on taking long-term loans especially housing loans .
Posted Using LeoFinance Beta
I rent, buying is not a good idea, at least not over here, especially now that the real estate market is going through a lot of uncertainty.
Posted Using LeoFinance Beta
Yea I don't think its a good time to buy. Before the lockdowns, I would of said it was fine to go buy a house but the economy is just too much unknowns right now.
Posted Using LeoFinance Beta
True but don't you think the risk might pay off huge ?
Posted Using LeoFinance Beta
I am unsure since 3D printing is starting to take off. If you buy a house now and the building costs decrease then the prices of houses drop.
Posted Using LeoFinance Beta
Oh I meant to say just the site ( meaning without any building )
Posted Using LeoFinance Beta
Yea land will always be good but you are probably still liable for taxes to the government.
Posted Using LeoFinance Beta
Yeah but property tax isn't huge here and they rarely collect it properly lol .
Posted Using LeoFinance Beta
Probably... real estate is known to be a solid investment, it's just not for me. I prefer other approaches
Posted Using LeoFinance Beta
Well here it is a good investment right now . Many are selling their property due to COVID ( because of the need of money ) and the rich people are just grabbing them .
Posted Using LeoFinance Beta
I don't know much about land and property but what I know is over here, there are so much available land for sale. So I prefer building one then renting it out to people. That too can serve as a means of income.
You can get a land here for $1000 or maybe less in some rural areas. This is one of my goals in life. To buy a land in a school environment, build an hostel and rent out to students who wants to live outside school campus.
Posted Using LeoFinance Beta
I think its great if its cheap in your area. I think the biggest issue that its far too expensive for land in the US.
Posted Using LeoFinance Beta
Here in India , it depends .
Outskirts - land is cheap right now .
City - way too expensive .
Transitional areas- very good opportunity to invest if we get a good price .
Posted Using LeoFinance Beta
I would do this too. In this part of the world it's more reasonable to buy and rent out to people, especially in a student area. Also for myself I'd prefer to buy, it eliminates the risk of having issues with landlords
Posted Using LeoFinance Beta
Ownership also has a lot of risks too. As well as headaches.
Posted Using LeoFinance Beta
Yeah it does. But there is a certain peace that comes with it, owning something means you don't have to answer to anyone but yourself. I like that feeling
Posted Using LeoFinance Beta
Except the bank and government which can be equally as nightmarish.
Neither are fun to deal with.
Posted Using LeoFinance Beta
True... I sometimes think people have a false sense of security in that kind of situation.
Posted Using LeoFinance Beta
Yeah but tenants are not easy to handle too lol .
Posted Using LeoFinance Beta
😂😂 yeah, people problem.
Posted Using LeoFinance Beta
Yeah :p lol
Posted Using LeoFinance Beta
That's a great idea bro.
If you can buy a piece of land and rent it out. That's passive income. Good thing is that new students will always come every year. So the demand is going to be high.
Posted Using LeoFinance Beta
Hehe students will come every year ? Are you sure ? I mean look at Indian schools right now , one of the most messed up industry this year is Education
Posted Using LeoFinance Beta
Jeeez, I almost forgot man. This idea is definitely not Pandemic proof.
You are absolutely right. Schools are shut for a very long time. The education industry is messed up.
On the other hand, Edtech is booming since everything is going online.
I think every industry now needs to ponder upon how they can survive such situations.
Posted Using LeoFinance Beta
Exactly .
Unacademy , Byju are taking over the education space in India .
But I don't really think it is a good idea for 1-5 classes though .
I was an external teacher for class 8-9 for 3 months and the kids didn't really learn that much through live classes lol .
Posted Using LeoFinance Beta
I think we will take our own time to get accustomed to such settings.
It's new for everyone but I see the culture changing.
My only problem with this model is that most Indians don't have proper access to the internet. They still depend on schools for their education. It sucks bro.
I felt so sad when I heard news of kids killing themselves because they could not attend live classes.
Posted Using LeoFinance Beta
Exactly , I can relate to that .
I used to struggle a lot because of poor internet connectivity , lot of service providers like BSNL and Airtel just reject providing broadband connection to my place because we live in remote area .
All this universal connectivity that we see on TV is BS .
Yeah :( Tough time for Indians . Well for people all over the world , but it is hitting on a different level for Indians right now .
Posted Using LeoFinance Beta
Must have been a great learning experience for you. 😂
Btw what did you teach?
Posted Using LeoFinance Beta
Computer Science :)
Posted Using LeoFinance Beta
That can be a good investment. Not really my kind of thing but it can be very rewarding depending on how the market is where you live.
When I was a student I rented a house outside campus and it was overpriced as hell because of the high demand, so you will probably do well with that plan.
Posted Using LeoFinance Beta
That is a great idea. There are the maintenance costs of being a landlord. Taxes are also another expense to be looked at.
Posted Using LeoFinance Beta
And headaches.
I know my landlord always has crap happening. She has a 30 unit place, and always something going on. Tenants not paying rent, destroying stuff, things breaking.
Posted Using LeoFinance Beta
Exactly , it is not easy being a landlord , we had a house which we have rented to someone a couple of years back and we had such a hard time collecting the rent . The tenant used to come up with one or the other excuse every single time , eventually we sold the house lol
Posted Using LeoFinance Beta
That is what many overlook. Being a landlord can be a nightmare. The rent moritorium is really messing with small landlords now.
Posted Using LeoFinance Beta
I felt sorry for my landlord when I was in college... we lived in a big house shared by 13 stupid college kids. We wrecked the place hard
Posted Using LeoFinance Beta
Lol really ? 13 kids ? How many rooms ?
Posted Using LeoFinance Beta
Exactly . If I ever rent out my house , I would make sure I give it to a person who is honest . Even if it is for less amount .
Posted Using LeoFinance Beta
Buying a house is not a great idea if you are going to live in it. It will only suck out more money from your pockets.
Rent :)
Posted Using LeoFinance Beta
It depends. For people starting to get their cash flow going, you can always got a mixed rent/live route. By doing so, it may be cheaper than just outright renting but it does come with its own risk.
Posted Using LeoFinance Beta
Depends on where you buy the house actually . If you see outskirts of Bangalore , lot of good opportunity to invest .
Posted Using LeoFinance Beta
Yes, for investment purposes it's definitely a buyers market, and thanks (unfortunately) to covid, you can get great deals.
But if you are taking debt to buy a house where you are going to live, it's a bad expense then.
Posted Using LeoFinance Beta
True but I have decided not to do that . I would never take a loan for such a huge amount just to buy a house.
Posted Using LeoFinance Beta
I have done that mistake myself but at least I had a house previously from where I WAS getting rent, until COVID took over. My wife was so adamant about buying our OWN house and I could not convince her because I was stupid back then.
So it's a bad investment which I regret now. But it's okay, at least I learned and I will never suggest anyone do to the same.
This is the general rule I follow now: If I have the money to buy 'two' of the same thing, only then I think of buying one.
Posted Using LeoFinance Beta
That's a good rule to be honest . I like that .
Posted Using LeoFinance Beta
I read that in a book about personal finance. Don't remember which one. Good that I still remember the rule 😜
Posted Using LeoFinance Beta
I currently rent. If I had a family it might have been different.
When one buys a home they do not only have a mortgage to pay, but also insurance, property taxes, school taxes (whether one has children or not), maintenance, and a variety of other costs.
Here in Pennsylvania it is extremely expensive to own a home. Sure one builds equity, but I do not really think it is worth all the costs associated with home ownership.
Renting also has drawbacks but, given my financial situation, it makes the most sense.
Posted Using LeoFinance Beta
Yea its tough without a decent amount saved up. Renting just makes sense given the current prices.
Posted Using LeoFinance Beta
You might acquire equity but, if you have a mortgage, you have to time it properly. Yes markets can run up but they also go down.
And that interest rate keeps piling up. The truth in lending statement would open up some eyes if people actually read it.
And let us not forget that over 15 years, you will have to replace a bunch of expensive stuff like AC, water heater, appliances and, perhaps, a roof and some windows.
Posted Using LeoFinance Beta
I currently own so this doesn't apply to me but if I am faced with this situation here in my country , I would go with renting because buying in a town is way too expensive .
Posted Using LeoFinance Beta
Responding with sincerity, I think that renting today is much better. But today if I had comfortable financial conditions I would buy a house :)
Posted Using LeoFinance Beta
Yea I think having an actual house is better for comfort. You know you won't have to deal with any landlords and you are in control of what happens.
Posted Using LeoFinance Beta
Yes, for those who have a family, it is even more acceptable to have a home of your own. But I know that there are people with families who prefer rent. Each one see which is the best for you :)
Posted Using LeoFinance Beta
I disagree. Always buy, looking for the best clear price. I am of that maxim that "the best investment on earth is land" and that despite abusive taxes.
Posted Using LeoFinance Beta
Yea but I think one of the biggest issue is that you can't really fight increases in property taxes. I just can't see it as a very good choice currently when the deficits are so huge.
Posted Using LeoFinance Beta
Yes, but even with taxes, I think the risk-benefit ratio is good. Governments change, the uses of real estate as well, but land is limited and unfortunately we are more and more. 8,000 million people, when we reach 30,000 million we better have a couple more planets because otherwise we all know what will happen.
You do realize we are facing population reduction throughout the rest of this century.
There is plenty of land available so I think you might want to update your metrics.
https://en.wikipedia.org/wiki/Total_fertility_rate
Posted Using LeoFinance Beta
Hopefully I'm wrong. This is not what has happened so far and the developing countries continue to increase the population. The so-called western countries with low birth rates example "Europe" increases its population via immigration.
But like I said, hopefully I'm wrong.
That is true but the immigrants have to come from somewhere and that is the developing world which pulls more out of their countries.
Plus birth rates are slowing in those countries too. Still higher than the developed world but half of what they were 25 years ago.
Posted Using LeoFinance Beta
You can't say this in Russia :)
Posted Using LeoFinance Beta
What do you mean? Russia is one of the largest producers of raw materials on earth, it has some of the strongest real estate markets. Governments steal in Russia and elsewhere, and if you have friends in the government or any other local establishment, the investment will be incredibly profitable. If, on the other hand, you have enemies, in some places you may lose more than an investment.
I think you didn't get my point :p I was going for , land isn't yours permanently in Russia unlike here in India .
Posted Using LeoFinance Beta
Okay! now I understand you.
Is that so? I didnt know about that
Posted Using LeoFinance Beta
Yeah , you can take a lease for 99 years or so . after that it goes back to government if your kids don't renew . Well the ultimate owners are government itself .
Posted Using LeoFinance Beta
Right at this time I own my own home, since my husband passed and if I was totally living alone on my own I would just rent. As it goes at this moment in time I can't just get up and leave. I first have to see if I can sell the house I am in, then see if I can get help to move out. As I am older it is to much trouble to maintain a home. If you own your own home one has to pay for property tax twice a year, find someone to help take care of the yard up keep. Plus if any repair work needs done on house itself then as home owner I have to find someone to help with that. Of course you do run into bad landlords who refuse to fix anything when you are a renter. The good part of owning my own home is that inside my own home I can pretty much do whatever I want. I can have animals such as cats or dogs if I want when renting you have to ask the landlord if you can have them or not. Any way that is my take on having a house.
Posted Using LeoFinance Beta
Your post was promoted by @amr008