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July 27, 2018, 12:18 AM
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![epitaph's Avatar](image.php?s=d44a16c4266df02e7daff310f2a78823&u=5572&dateline=1476598335) |
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Buy or Rent?
Which is better in general in terms of long-term net worth?
Heard cases for both.
Remember Mufi saying he rents himself and rents out his house.
And heard multiplexes are the best since they pay for themselves monthly (if 30 yr mortgage) once you rent out the remaining rooms and units.
Basically, trying to decide between:
- Keep renting
- Buy a condo and lease the other room
- Buy a house and lease other rooms
- Wait, save up more, and buy a duplex/triplex
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July 27, 2018, 01:32 AM
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what market are you looking at and do you have a family?
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July 27, 2018, 04:03 AM
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It all depends on your financial situation and the premium between renting and taking a property on mortgage really. Also lets not forget one's personal circumstances and the property market of the area you are buying into
However IMO I would say buy rather than rent if you can afford to. Buying a house with a mortgage is like renting but with a fixed asset at the end for yours to keep.
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July 30, 2018, 09:13 PM
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![BengaliPagol's Avatar](image.php?s=d44a16c4266df02e7daff310f2a78823&u=14645&dateline=1537757060) |
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Quote:
Originally Posted by adamnsu
It all depends on your financial situation and the premium between renting and taking a property on mortgage really. Also lets not forget one's personal circumstances and the property market of the area you are buying into
However IMO I would say buy rather than rent if you can afford to. Buying a house with a mortgage is like renting but with a fixed asset at the end for yours to keep.
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the way you termed it, it is an asset yes. But it is where you live. You sell it, you got nowhere to live. So it isn't an asset in the more traditional sense of how an asset is termed.
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July 31, 2018, 04:41 AM
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Quote:
Originally Posted by BengaliPagol
the way you termed it, it is an asset yes. But it is where you live. You sell it, you got nowhere to live. So it isn't an asset in the more traditional sense of how an asset is termed.
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I dont understand what you are trying to say TBH. As far as I know an asset is something one owns and has a monetary value. If this isnt a traditional sense, could you please give me one so I can understand what you are really trying to get at?
It would be illogical if you sell a house without not making sure you dont have another house to live in?
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July 31, 2018, 05:24 AM
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![BengaliPagol's Avatar](image.php?s=d44a16c4266df02e7daff310f2a78823&u=14645&dateline=1537757060) |
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Quote:
Originally Posted by adamnsu
I dont understand what you are trying to say TBH. As far as I know an asset is something one owns and has a monetary value. If this isnt a traditional sense, could you please give me one so I can understand what you are really trying to get at?
It would be illogical if you sell a house without not making sure you dont have another house to live in?
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I'm speaking from the pov that a person doesn't have a house yet but is looking to either rent or buy one. People on this thread are talking from the perspective that buying is better cos at least you have an "asset".
But that is a wrong way to look at it because you are essentially living in the so called "asset" and people think "oh yeah If things go bad at least my house is an asset and I can sell and make money". And in also other circumstances when the price at which the person bought the house was low and they're living in the house and they know that the value of their house is now a lot, people also think "yeah imma make heaps of profit from selling my house", neglecting the fact that if they sell their house i.e. asset they wont have a place to live and they may think that "i can just buy another cheaper house" but then all the houses prices around their area would have also increased as well.
Therefore thinking a house as an "asset" which you live in, is not exactly the same as other types of assets such as shares where your day to day life and livelihood is not affected by you buying and selling shares.
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July 31, 2018, 06:27 AM
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Sorry but I still cant see your point here.
"I'm speaking from the pov that a person doesn't have a house yet but is looking to either rent or buy one. People on this thread are talking from the perspective that buying is better cos at least you have an "asset". Once you own something it becomes an asset from an accounting point of view.
But that is a wrong way to look at it because you are essentially living in the so called "asset" and people think "oh yeah If things go bad at least my house is an asset and I can sell and make money". And in also other circumstances when the price at which the person bought the house was low and they're living in the house and they know that the value of their house is now a lot, people also think "yeah imma make heaps of profit from selling my house", neglecting the fact that if they sell their house i.e. asset they wont have a place to live and they may think that "i can just buy another cheaper house" but then all the houses prices around their area would have also increased as well.
Based on this I can tell you didnt properly read what I wrote about the advantage of buying a property than renting, but also highlighted the variables involved.
Therefore thinking a house as an "asset" which you live in, is not exactly the same as other types of assets such as shares where your day to day life and livelihood is not affected by you buying and selling shares.
There are different kinds of assets as far as I am aware the house and stocks and share are clearly not the same type. You are comparing oranges and apples based on this statement so cant see how your logic applies. Yes I agree both are different types of assets but thats not the point of the discussion in here.
Last edited by adamnsu; July 31, 2018 at 07:00 AM..
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August 1, 2018, 12:27 AM
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![Jadukor's Avatar](image.php?s=d44a16c4266df02e7daff310f2a78823&u=10587&dateline=1289727540) |
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Quote:
Originally Posted by BengaliPagol
I'm speaking from the pov that a person doesn't have a house yet but is looking to either rent or buy one. People on this thread are talking from the perspective that buying is better cos at least you have an "asset".
But that is a wrong way to look at it because you are essentially living in the so called "asset" and people think "oh yeah If things go bad at least my house is an asset and I can sell and make money". And in also other circumstances when the price at which the person bought the house was low and they're living in the house and they know that the value of their house is now a lot, people also think "yeah imma make heaps of profit from selling my house", neglecting the fact that if they sell their house i.e. asset they wont have a place to live and they may think that "i can just buy another cheaper house" but then all the houses prices around their area would have also increased as well.
Therefore thinking a house as an "asset" which you live in, is not exactly the same as other types of assets such as shares where your day to day life and livelihood is not affected by you buying and selling shares.
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Think of it this way, if you continue to rent till you retire and lets say you dont have sufficient pension then you will have to find that money to rent a place until you die which could be for another 20 years. For most people the safer alternative is to move into their own house or apartment so that after retirement all you need to worry about is your living expenses. Plus land prices will continue to appreciate while you work towards it so if you buy the house knowing where the next city center is going to be then you will be able to sell the place and happily move to a cheaper and quiet neighborhood. Now if you are really disciplined and forward thinking, you could srart saving now for retirement and actually have enough money to rent a house as well as cover your living expenses for 20 years post retirement, but most of us arent that good and tend to blow our excess income on useless things. So for those folks forcing yourself into a mortgage situation actually forces you to keep that money aside and turn it into an asset which might have otherwise gone into a holiday trip to NZ or gadgets or UHD tvs etc.
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July 27, 2018, 07:29 AM
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![mufi_02's Avatar](image.php?s=d44a16c4266df02e7daff310f2a78823&u=12172&dateline=1520793712) |
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Quote:
Originally Posted by epitaph
Which is better in general in terms of long-term net worth?
Heard cases for both.
Remember Mufi saying he rents himself and rents out his house.
And heard multiplexes are the best since they pay for themselves monthly (if 30 yr mortgage) once you rent out the remaining rooms and units.
Basically, trying to decide between:
- Keep renting
- Buy a condo and lease the other room
- Buy a house and lease other rooms
- Wait, save up more, and buy a duplex/triplex
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I haven't bought yet. hopefully this year InshaAllah.
thing is in US, real estate has become very hot. prices are slightly inflated. I should have bought it last year. so right now its a seller's market. inventory is low and demand is quite high (good economy, fear of rising interest rate).
But owning is the right option, if your current rent will be equal to your future mortgage. you are building equity.
but as yankees said, it's all relative based on the market you are at. it is not consistent across the board but do note that mortgage rate will only go up in the next few years. do your due diligence and start looking at some places.
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July 27, 2018, 10:47 AM
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![bujhee kom's Avatar](image.php?s=d44a16c4266df02e7daff310f2a78823&u=5430&dateline=1511582319) |
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Buy
Rent it out
Sleep on a park bench or on the subway
Save enough to buy another
Follow this method and someday Insh Allah you will own a small town in Idaho.
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July 27, 2018, 12:53 PM
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![Shingara's Avatar](image.php?s=d44a16c4266df02e7daff310f2a78823&u=16975&dateline=1457307210) |
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Quote:
Originally Posted by bujhee kom
Buy
Rent it out
Sleep on a park bench or on the subway
Save enough to buy another
Follow this method and someday Insh Allah you will own a small town in Idaho.
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You do ?
Na ? Tailey eishob azaira advice diyen na.
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July 30, 2018, 07:56 AM
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Quote:
Originally Posted by Shingara
You do ?
Na ? Tailey eishob azaira advice diyen na.
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And you think the conversation in this thread is serious? ![big grin](images/smilies/biggrin.gif) If it was I would be 100% agreeing with you.
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![Old](images/BanglaCricket/statusicon/post_old.gif)
July 27, 2018, 07:20 PM
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![epitaph's Avatar](image.php?s=d44a16c4266df02e7daff310f2a78823&u=5572&dateline=1476598335) |
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How likely is a recession in the next 4 yrs? You know, with Trump and all.
Quote:
Originally Posted by bujhee kom
Buy
Rent it out
Sleep on a park bench or on the subway
Save enough to buy another
Follow this method and someday Insh Allah you will own a small town in Idaho.
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Honestly, I would consider living in a storage if people at work weren't judgmental. Don't care if people outside work are.
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July 27, 2018, 03:46 PM
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![Jadukor's Avatar](image.php?s=d44a16c4266df02e7daff310f2a78823&u=10587&dateline=1289727540) |
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I bought a house but ended up selling it for profit after about 6 years. Now in the market to buy again. While buying is the sensible choice since the mortgage sort of forces you to save towards owning an asset, one must always keep in mind the resale market of the property in case your economic situation becomes significantly better and you want to move to a better neighborhood that seems out of reach at the moment.
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July 28, 2018, 01:24 AM
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Quote:
Originally Posted by Jadukor
I bought a house but ended up selling it for profit after about 6 years. Now in the market to buy again. While buying is the sensible choice since the mortgage sort of forces you to save towards owning an asset, one must always keep in mind the resale market of the property in case your economic situation becomes significantly better and you want to move to a better neighborhood that seems out of reach at the moment.
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Where did you buy and why did u decide to sell?
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![Old](images/BanglaCricket/statusicon/post_old.gif)
July 28, 2018, 01:36 AM
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Quote:
Originally Posted by Yankees
Where did you buy and why did u decide to sell?
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Bought in Thailand. The housing market was soft right after the massive flooding in 2011 and i took the opportunity to buy at a relatively lower price. Over time i felt that i could afford a better house in a better neighborhood and took advantage of the upswing in price due to the start of a metro rail connection and construction in my area. My plan now is to invest the profit and a sizable capital at once in a new property to reduce the mortgage loan amount as well as the interest.
Another advice i would give is to always look to refinance your long term loan if you notice better/lower mortgage rates. I did that to bring down my interest after 3 years through a different bank.
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July 29, 2018, 01:34 PM
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Quote:
Originally Posted by Jadukor
Bought in Thailand. The housing market was soft right after the massive flooding in 2011 and i took the opportunity to buy at a relatively lower price. Over time i felt that i could afford a better house in a better neighborhood and took advantage of the upswing in price due to the start of a metro rail connection and construction in my area. My plan now is to invest the profit and a sizable capital at once in a new property to reduce the mortgage loan amount as well as the interest.
Another advice i would give is to always look to refinance your long term loan if you notice better/lower mortgage rates. I did that to bring down my interest after 3 years through a different bank.
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that's interesting. Are you a permanent resident of Thailand? With the rate that SEA is developing, it would be fun to buy something in Thailand, Philippines, Indonesia, and just hold onto it. Sounds like you've got the right idea.
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July 27, 2018, 10:30 PM
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Parents bought apartment, in 2008 for 190K sold for 410K this was in Metro Western Sydney.
Preferably buying is the way to go as others have said you get a fixed asset and the end.
Then again I am not expert.
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July 27, 2018, 10:32 PM
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If you guys think the property market in the USA is bad, wow come to Australia with 500K you would be lucky if you can buy a shack.
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July 29, 2018, 01:53 PM
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I've been looking at buying something in NYC area. It seems to be a sellers market now, so I'll hold off for now. But curious what others with more experience thinks of the market now.
I'm single and looking at it as an investment, so solely looking at multi-units. I'm not even considering living there.
For NYC, I think its as safe of a bet as can be. The only downside I see is having to deal with tenants and the general upkeep needed. Not to mention tenants have too much power in this city. Am I wrong?
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July 29, 2018, 02:01 PM
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^ is there anything less than $500-600k in NYC? I think the price is way too inflated there. 20% down payment means 100k at least.
That’s out of my reach really. Have to sell a kidney to afford anything in NYC these days.
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July 29, 2018, 06:51 PM
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yea sure, if you are interested in gut renovations that are 20 mins away from the nearest subway station. places like maspeth, flatbush, sunset park.
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July 29, 2018, 08:04 PM
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![epitaph's Avatar](image.php?s=d44a16c4266df02e7daff310f2a78823&u=5572&dateline=1476598335) |
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Dream: Triplex, build a tiny house in backyard and rent it out too, an aquaponics garden in a greenhouse at the other end, sell microgreens to restaurants. Maybe even sell worms (will have them for garden anyway) and keep bees. Part-time farmer, part-time landlord hehe.
Right now, cheapest condos here are $100k. Sellers market but people are moving into the city.
Buy a condo now or do nothing and wait for next recession to buy a multiplex. Decisions, decisions...
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July 29, 2018, 11:34 PM
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I rent by choice. It is not a good financial move but it gives me a lot of freedom. My current monthly rent is 1800, if i buy and the area and type of house I would move into my monthly mortgage will go into 4000 to 4500/mo. While living in one location more than 5 years automatically makes purchasing a better choice - there are other factors ppl don't consider. Lifestyle.
That's 2000 dollars a month extra I have to pay just to have a roof over my head and that ties up the money in an illiquid asset and will not allow me to take vacations or do whatever I want to do at any given moment.
I enjoy this freedom. I do not believe in living in the closet to save money and spend it when I am old. It doesn't fit well with me.
In my opinion and above average analysis, buying is always better. But one can not give advice on individual situations..
Another point is - buying should happen when you are ready. NOW. Just like stock market. You can not time it. Housing goes through cycles and it is difficult to predict when is the right time to buy. NYC is an international market, not a "local" market if that makes any sense. So even if housing prices outpaces significantly any increase in salary of locals - it is not necessarily an overvalued market..
for ex: A lot of developments in Jamaica Queens where a massive Bangladeshi ppl stay - lot of these are financed by wealthy ppl from Bangladesh. Not local bangladeshis/ppl. And these demands for space keep the prices shooting higher and higher. And that is the case all over NYC with ppl with money from china, india, russia are looking to "diversify/legitimize" their wealth.
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July 29, 2018, 11:37 PM
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4 years ago, I offered for a house in queens with 740K, a chinese buyer offered 770 cash. I backed out as there is no way i can compete with someone who can pay that much money with cash. That property currrently is valued at 1.4 million. And that is the story of my life.
It is not overvalued - you are just competing globally - which makes it very tough... just have to have a little bit of luck on your side sometimes.
By luck i mean if for that house there were no outside cash buyer, the owner would have countered my offer and i would have gone up maybe another 15 to 20K and settled because i really liked that house. But with the cash buyer it becomes a bidding situation - and I wasn't gonna win with my w2 earnings against those type of investors ![Sad](images/smilies/sad.gif)
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