Dreaming of owning my own home for a long time - because I simply didn't know it any other way from my parents. Then I started to research, to calculate, to get clear about my personal preferences, wrote a series of articles on getquin [1] and finally came to the conclusion that property a) is currently too expensive and b) represents an incalculable risk. The money that I had saved for a home in safe forms of investment has been shifted into ETFs for some time. Currently, about 160k still need to be added to the portfolio. [1] https://app.getquin.com/activity/FoLdCxttXY
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@DonkeyInvestor I see it in a similar way at the moment. The question is whether one is really better off with a property at some point in old age. But that also depends on your own provision via shares and their dividends, whether you can close a pension gap with it if necessary. Great series of contributions. I liked it!
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@DonkeyInvestor Isn't the development of rents an incalculable risk? The housing shortage is currently getting much worse in urban areas, as construction projects are not increasing due to the current interest rate policy. My real estate loan, for example, runs for 20 years, I know my risk and can plan well over this period with regard to term and unscheduled repayment😊 Inflation also plays into the cards. But I can't plan how high my rent will be here in Munich in 20 years or how much I'll have to pay if I have to leave the rental apartment in 20 years. Of course, it's true that a lot of capital is tied up in the property, but once I've paid it off, I'll only have to pay incidental costs. For me personally, this is half the rent for the pension. Also, the risk regarding renovations breaks down to all units in my ETW. With an EFH, the risk regarding retention for renovations is a greater risk. Personally, I would do it again and again, even if the current rates will of course be higher than the rent payment.😊 Currently, however, I must also agree with you, the prices are still too high in relation to the increased interest rates🤚
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•@Wellenreiter That's why I also see the floor apartment as a realistic alternative, despite the house money, as soon as the prices have caught up to some extent. Of course, you have to be the type for - party from 10 o'clock then only with the consent of the neighbors, but I would not mind. The simply also invite the same😊
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•@BASS-T yes is always the question how much party you plan at home😂 at WG times in the study it would have been an unsolvable problem
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•@Wellenreiter new laws like Habeck's or changes to the property tax, expensive modernizations, damage to the property for which no insurance pays, more effort for maintenance, missed opportunities due to commitment to a place, changes in family planning or simply children moving out, structural changes and thus loss of value, a declining population, lump risk real estate / Germany, ...In return, there are tenants who tend to belong to the poorer part of the population and therefore imho will be more protected by the state in the future. Of course, you can think about it from a financial point of view, if the EK share is low and the repayment + interest only marginally above the cold rent. But especially in Munich, this ratio is beyond good and evil.
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@DonkeyInvestor But on whom are modernizations or other increases and dreams of politics passed on? On the tenant, of course. Modernization is the best example of this. The state can no longer protect, quite simply because otherwise even less will be built if renting becomes too unattractive. A vicious circle the whole😅 I can live well with the lump risk regarding my choice of location. I grew up here in Munich, there are enough jobs and family is also based here. If, however, a property can be sold, or I rent😬 But yes, of course you're right that the change of location as a tenant is easier and much cheaper. As an example, my EK share was ~45%. I did not want to liquidate my portfolio for this. Alone the dividend yield is more than 0,83%😉 So in my case I don't really pay more than if I would live for rent. With lower EK share the "temporary" disadvantage compared to rent becomes bigger of course. You're right about that, but in the end I'm still paying into my own pocket, minus the interest. Loss of value vs. appreciation: well, both of those leave me cold for now, since I live there myself and so the loss or gain is irrelevant to me. I don't see my owner-occupied ETW as a speculative object. But yes, saving up the equity meant making sacrifices and didn't come flying out of the sky. Many people always forget this when they rail against the "rich" owners😉.
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@Wellenreiter Yes, it is passed on to tenants. But when I see older people who need to modernize but can't afford it, it's a completely different story than paying a few euros more rent per month. As a landlord, you have completely different options (e.g. tax) compared to an owner-occupier.
If you rent or sell the property, you have more stress and have to rent afterwards (or accept the then valid purchase prices and financing options). On the contrary, a high equity ratio is rather a hindrance, since this is very likely to work much better for you on the stock market than in an owner-occupied property. But financial aspects are not everything. The most important thing is that you feel comfortable with your decision 👍
If you rent or sell the property, you have more stress and have to rent afterwards (or accept the then valid purchase prices and financing options). On the contrary, a high equity ratio is rather a hindrance, since this is very likely to work much better for you on the stock market than in an owner-occupied property. But financial aspects are not everything. The most important thing is that you feel comfortable with your decision 👍
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•@DonkeyInvestor yes, basically it's like you say. A case by case decision👍
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@BASS-T but depends a lot on your neighbors... I'm currently really happy not to live in my (professional) shared apartment for too long. My roommates are top, location top, landlady top, cleaning staff as well. Above them, a family with 5 children has just moved in (2 months to 7 years old). The children are 90% of the day in the apartment, through the (beautiful) old building you can hear the children with Bobbycar and scooter brettern over the floorboards. The wife and her boyfriend (is probably not the father) yell at each other half the day long ... 2 months ago there lived an old couple, which you have never heard (!). For me, therefore, in the long run really only a detached EFH again in question - as soon as the price is halfway reasonable. You can certainly have a lot of luck with his neighbors, but is always a bit of coincidence. In the implementation of a home theater is usually the end in the multi-party house anyway. Have now saved a lot of money for many years by small apartments, but slowly I long again for what I know from childhood. Just do not see it to pay 500k € + for it.
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•@KevinC I understand that all too well. It remains exciting what happens on the real estate market. I just hope so slowly for reasonable prices.👍
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