Buying a house with me is buying liabilities on people, why?
Le Nhi (28 years old, Saigon), is currently a Senior Marketing Executive at an IT company. Working with the profession for nearly 5 years, Nhi’s salary has now exceeded 30 million/month. In addition, she also participates in a number of private projects to earn extra income.
When she turned 28, with all her savings, Nhi decided to go all out to buy a house of nearly 2 billion in Go Vap. Her perspective on owning a real estate is very different from many young people today. Let’s listen to Nhi’s share on whether to buy or rent a house!
What is Nhi’s opinion on whether you should buy a house or rent a house when you are young? Do you have the option to buy a house and then rent it out for investment? From your point of view, will such a real estate investment be effective?
I determined that I myself did not get rich from real estate, and I am aware that I do not have that ability. I simply need to buy a house to live in, so I don’t want to rent a house. Since I’m going to pay rent anyway, why not buy it?
I also have a slightly different view of assets and liabilities. Usually, people categorize the house as an asset. But I am aware that, the moment I spend money to buy a house and live, that house becomes a liability for the rest of my life.
Why do I say that?
Because, while you still have to pay electricity and water bills, money to buy furniture, money to maintain the house, … and countless other expenses to maintain “life” for the house itself. Then, the amount of profit is probably equal to the money you spend to repair your own house. Your assets will have to be taken out to pay for that house. So, buying a house to live in, for me, is buying assets for people.
But some of my friends choose to rent houses to live in and invest their money. And most of them are rich. My friends choose to buy houses in the center and rent them out for profit. The rental amount is calculated to be enough to pay the bank interest, as well as still have a balance. And they never buy just one, but many, buy continuously and so on and so on. That’s how they choose to invest and rent, not just spending money without thinking carefully. And that’s what property is.
Therefore, the kid who only had enough money to buy a house like me, determined to buy a house just to live in, and didn’t dare to join that real estate game. If you buy a house and then calculate it to rent it out for a profit, that profit is only enough to maintain a very small cash flow to maintain. It’s not enough to feed myself.
According to Nhi, if you have less money, you should contribute money to buy a house to stabilize, and if you have a lot of money, you should invest in real estate to make money? Is this considered a general formula that everyone can apply?
I confirm no. This is not a recipe for everyone. This is a formula that depends on what your individual needs are looking for in the future, depending on your current financial ability, and sometimes it depends on your age.
When you are 23-25 years old, full of youth, rich in money, exposed to many active earning opportunities, then you will play finance in a certain way.
As for me, when I turned 27, I didn’t know many ways to make money, wanted more stability, I played finance in a different way.
The most important thing is to be aware of where you are and how you can control your finances. Then decide whether you should choose to buy or rent a house, choose how to invest to suit what you find most compatible.
Regarding the issue of buying a house on installments, or saving enough to buy, does Nhi have any advice for other young people?
Actually, I think, to answer the question, should I buy a house on installments or save enough to buy? Then I think you need to identify 2 problems:
– What kind of house do you need, how big is enough?
– What is your financial capacity now and in the future?
If you decide to buy a house just to live in, I think the installment payment will be good when you have a need, and the financial capacity then is only enough for you to pay the debt and interest on a monthly basis. Currently, many banks offer loans with preferential interest rates. This will be the fastest way for you to own a home. But handling finances at this time, requires you to be very careful.
However, if you are determined to invest, your mindset must suffice. No one gets into the investing game by saving enough money to buy. Waiting to save enough, real estate prices are also sky high.
I’m not an expert, so this is my perspective. I don’t want to give advice that is too specific, because it won’t be applicable in all cases. How to choose depends on the mindset of each person.
Photo: Synthesis
at Blogtuan.info – Source: cafebiz.vn – Read the original article here
