House is a forced saving

[2stout]

If you bought or refinanced a house during covid when rates were historically at their lowest, then congratulations on your forced saving.  It will serve and do you well, while other are on the outside looking in with these almost historically high interest rates.

[Bitcoin2009]

As an user mentioned owning a house have turned to be a source of pride. Constructing a house for our long need is different, but constructing a house for pride with loans is bad decision. When it is applied to commercial purpose, atleast it'll bring some revenue. In third world countries people having a good house is rich and that too a reason why people prefer on house over stocks and other forms of investment.

The purpose of owning a house is of course to educate and as an asset in the future, a house is certainly more profitable than stocks, property prices will continue to rise and can keep pace with inflation so that it is more worthy of us to make it a priority, it is a big mistake if someone holds shares but he has to pay annual house rent .

[FanEagle]

I would say forcing yourself to save for something else would be a lot more smarter. I always understood the first house because you would live in it, or even if you rent it out, the income would cover your own house, that makes sense. But after that, I would say real estate is not a smart investment because you could do something better.

Even if you want to get a loan and invest into real estate, do not buy a house, buy a business, like a storage, or a warehouse, or anything like that, because renting it to a company is better method than renting it to some other person, people could fail, companies either make money or they go bankrupt, which they won't want anyway, so it’s much better.

[Yatsan]

As an user mentioned owning a house have turned to be a source of pride. Constructing a house for our long need is different, but constructing a house for pride with loans is bad decision. When it is applied to commercial purpose, atleast it'll bring some revenue. In third world countries people having a good house is rich and that too a reason why people prefer on house over stocks and other forms of investment.

The purpose of owning a house is of course to educate and as an asset in the future, a house is certainly more profitable than stocks, property prices will continue to rise and can keep pace with inflation so that it is more worthy of us to make it a priority, it is a big mistake if someone holds shares but he has to pay annual house rent .

An asset, yes. But the amount of money you would invest into a house could also be an amount which would give you bigger income. You may invest that money into business, then once you're having stable profit, that would be the time you will build your dream house. The market value of a house and lot property would indeed increase as years go by butthere are other assets which could give you bigger and faster interest. Perhaps apartment; could be invested equally with a dream house because a house would be more detailed than apartment units whcih would cost less but will generate multiple profits if you'd have several units.

Or try making it a commercialized space wherein it would be bossted in many aspects, you may offer it to tenants or you yourself could use it for your desired business. Spend your money wisely.

[Mauser]

Buying a house with debt is normal in my country, I haven't heard of anybody who was able to buy a house without having a loan. House prices have risen drastically in the last 10 years, whereas wages are not keeping up. The percentage of rent or loan repayments from the monthly salary is rising every year and it becomes harder to maintain the sane living standards. Still owning your home one day is the number one goal of young adults, they would rather give up on a nice car and vacations to afford their own house one day. Here it's normal to have 20% equity and get the rest from the bank. The problem for me is that many people view their own home as an asset, even though it doesn't generate income as they are living it themselves. In my opinion your own house should be rather a liability if its not modern or füllt renovated. Friends of mine bought their own house 5 years ago, only to find out now that the government regulations are changing and they are required to fully renovate it by 2030 to meet new energy efficiency standards. Their dream project almost ruined them.

[eightdots]

Buying a house with debt is normal in my country, I haven't heard of anybody who was able to buy a house without having a loan. House prices have risen drastically in the last 10 years, whereas wages are not keeping up. The percentage of rent or loan repayments from the monthly salary is rising every year and it becomes harder to maintain the sane living standards. Still owning your home one day is the number one goal of young adults, they would rather give up on a nice car and vacations to afford their own house one day. Here it's normal to have 20% equity and get the rest from the bank. The problem for me is that many people view their own home as an asset, even though it doesn't generate income as they are living it themselves. In my opinion your own house should be rather a liability if its not modern or füllt renovated. Friends of mine bought their own house 5 years ago, only to find out now that the government regulations are changing and they are required to fully renovate it by 2030 to meet new energy efficiency standards. Their dream project almost ruined them.

My dream of buying a house is no longer possible. The prices are very high and I will have to give most of my monthly earnings to pay for it. I can't choose such an option because I don't want to push my normal life too much. I wish someone who works in a normal job like before could buy a house comfortably. But this is a dream for me and very difficult to achieve. I also think that the person who buys a house is making an unnecessary investment if he is not going to live in that house. In how many years will the investment made with the rent received from this house pay for itself? I don't understand why they're tying their capital to a house where they can't live. Also, as in the example I quoted, the subsequent costs can be huge.

[wxa7115]

Yes, a house can be a store of value but it can also be a way to be indebted for the rest of your life and then lose everything once the next big crisis comes, so people need to make sure they avoid the second scenario while trying their best to achieve the first one.

And one of the easiest ways to do this is by buying a house you can actually pay in less than a decade, if the house you are buying cannot be realistically paid in that time frame then you are exposing yourself to a massive risk as economic crises appear roughly each decade, now this can be problematic to actually do as for example at the place where I live houses have been growing in size despite the size of families going down, meaning you need to indebt yourself for a longer period of time just to get a place to live.

I am going the other way just buy the house only if you have the complete money to buy them, no loan so no pressure. Most of the people who succeeded with real estate followed this rule but instead of buying one house they will go for 5 house and 20% as down payment then lay remaining with the rents coming from the house but I can assure these people are not applying this model for their first property.

That would be the best possible scenario but very few people are actually going to have such a huge amount of money saved for what it is the most important purchase on their lives.

So I think buying a house with a loan you can actually pay in a short amount of time is probably the most realistic scenario we can expect for the average person to implement, and even this is very hard for most people as this will require they buy a smaller house and they are constant on saving money each month and then use that money to make additional payments to their mortgage.

[DrBeer]

Real estate always has an appeal, both for improving the quality of life and as an investment object.
The first thing everyone strives for is to provide their quality accommodation. In your apartment/house. Paying only utility bills, and investing only in convenience and beauty. instead of paying the landlord.
The second is an investment, or an option to save your savings from inflation. In a good location, real estate always remains highly liquid.
The third is an investment instrument. I bought it when the foundation was being laid - I sold the finished apartment. Bought, made repairs, rent, get rent. I bought it, made repairs, you rent it by the day, you get rent, etc.

[trendcoin]

If you need housing and you pay rent to meet your housing needs, it's a savings but houses wear out as they are used and lose their initial value. Also, you constantly pay taxes when buying and selling homes. They are not always the first choice for a trader who really wants to save. Instead, I think it makes more sense to evaluate commercial license plates. My second choice may be to buy a land that is open to development.

[Broly46]

The alameda and ftx sam bankman fried, the Rosaline embezzle the sbf fund and ftx. It remind me of in 2021 every girl nagging on the bf for getting a Nintendo switch because she wanna play acnh and drove the retail price to the extreme. This chaos is indeed the element that’s needed for massive wealth transfer, or the cash heist to take place, without chaos guy wouldn’t give up their money in their fixed deposit bank, it would be as dead as stock market, although it’s self explanatory, but it’s there is a strong need to remind, as guy today is asking “how to make money”, unable to understand even the basic idea since they’re all being trained to be idiot in school, and getting more idiot as the school progress to even more extreme and torturing in both syllabuses and credit hours, they’re all think make money is go to school get job and magically the boss and the job would pay them a happy ending life, as if the boss owe them a happy life of wealth, there is simply no logic on it, no financial sense at all.

[Kakmakr]

Property investments can be less profitable than most people think....

You have to subtract several hidden cost from the profit that you make, when you sell the property, namely :

1. Interest on the home loan
2. Interest that you would have gained, if you invested the loan payments
3. Maintenance cost on the property that you bought
4. Home improvement costs
5. Transfer costs and Sales Agent commission and admin fees
6. Insurance payment on the property

So, yes... it is a forced saving... but it is also a forced expense, because you have to pay for a lot of things... before you can make a profit in the future. 

[Broly46]

You don’t get to why I get into property in 2010 in the past. I was furious, I was rejected by the entire society, every employer dislike me, every job application is rejected, and the dating market, ohhh the hypergamy market actual soar to an unbelievable extreme level, penniless, jobless that jobmarket is total shit by the time, all I did in all my day is wasted on competitive online game LOL CS & DOTA. By the time it was just a small cult, no TI or any money betting competition was organised in 2010, it’s all but video games for wasting time for loser like me, for the worse it’s money wasting too, no any successful or winner guy or school guy would bat an eyes on the loser habit like a gamer. I was looking at property market by the time it was all gloomy and cloudy, “property is for loser, loser look at property, you buy property now you would commit suicide when the market crashed in a few years!” I was told, tbh it was in 2008/2009 a couple of guy I know through fb jumped to their dead from their condominium which spark all the precedent and fear, the news on fb is removed and couldn’t be retrieved but I assure you it’s valid. Every fairly wealthy guy I talked to, tell me property is a dead end endeavour, anyone who invest into property now is idiot and bloke waiting to goes broke. Fyi any guy I met, is working for top 500 mmc and earning best buck one can dream and they shame property calling the price is absurd too high in 2010, and it would crash to the ground very low price, to which, they would then consider “affordable” by them... fast forward to 2020, what’s touted to be loser gamer guy habit in 2010, is now being charmed as winner successful career, “gamer is the best money making career and all guy dream job” is being gamer, it’s baffling, I was dumbfound, I was joking and cringed evilly, it stunned me it’s unbelievable a once used-to-be habit for the loser now become money making best career and many guy are betting big money on it to keep this gaming industry running and keep the gamer busy to play game even harder. I mean what’s going on, it’s insane, are guy today all blinded by the money? there isn’t money in the game played by loser, but nobody listen to me, interesting... idk but when I look at bitcoin again, I see the same shit again, today guy telling me bitcoin to goes to 100k, “isn’t it btc is for the loser” I asked myself again, idk what’s foolishness is going here again, it’s crazy... btw a few key take away, did I completely getting stunned and confused and dumbfound that property price today is soaring through the roof despite job market is totally collapsing?? Idk I was getting a little surprised but it just sink in and I move on quickly and accept the facts, after all the reality is always ironically, proving them wrong is exactly what we have been working for during the good time from 2010-2020, I would call it I sow the same seed and get the same fruit in the end, it’s all relativity from the beginning to the end, nothing earth shattering or ground breaking when my success come out to be on the expectation... now that a few guy approach me and ask me “how to make money?” I was cringing and I choose to ignore them altogether, yup they’re all looking for money and they come to me to get the advice, btw in the end they go to get advice from financial guy and they would likely goes on and loss all their lifesaving hahahahaha...!

[Genemind]

House investment couldn't be considered as an asset if it is not bringing you any income, you need to pay taxes, mortgage, maintenance, etc. Same with buying a car, it will cost you a lot to maintain it and it doesn't bring any income. Most people who become rich invest in themselves, start a business, and let it grow instead of buying a house first which is a dead investment. Recently when an earthquake hit our country, I saw a post on social media where there was a big house that was totally wrecked by the earthquake, the owner of the house saved and worked hard for a decade as an overseas worker and it all went to waste when the earthquake happened. Imagine if your life saving or the money you are intending to use to buy this asset is used to invest in something else or used somewhere else where you get a consistent or passive income.

My professor in business management used to advise us, if you are going to invest, invest into something that gives you returns, never make a dead investment not unless you have a consistent cash flow.

[Broly46]

Btw a few point I can observe, I’m  not saying the guy who work for top 500 mnc are lying with their paycheck, of course they made exactly the money advertised that’s the best buck on town, their take-home-paycheck is definitely jaw dropping and mouth drooling tbh, there is the catch, they seem to be unable to save the money no matter how hard they try, they make all the best buck yet, they would spend all those money on woman, either they toss all into hooker, or they just couldn’t get rid of woman, his gf spending all the money, or his wife, or his kids, or the females boss picking on them being no social life, it’s it. That’s a zero sum in the nutshell, I’m not trying to compare your high paying job to a property, but the thing that intriguing me is that house always win because house is a forced saving, all the money seem to be going into the house, instead of going into hooker or woman. So it’s your choice, keep trying to beat the house and see how great a person you are, in my best interest I would still insist your chance of beating the house is comfortably at 0%, no matter how smart you are, everything is working against you to win, don’t believe me? Keep trying, you haven’t try hard enough, you need to work more harder, you’re not good enough until you beat them, of course there is guy who beat the house it’s just not you, but you shouldn’t give up, keep trying okey! I’m out of the picture btw, ciao, lol.

[Sayeds56]

Guy often tell me house is a force saving. By looking at the market today, full of scammer roaming around, and countless unsavoury characters and get rich quick scheme, jobless highly educated youth. I conclude buyhouse is not only a “forced saving” but also a “save yourselves”.

We often heard about a lot of highly educated youth had no jobs, underemployed, which is very bad today and getting worse day by day. What they often failed to see is it has been norms in the past, do you not know every scientist is borderline poor and bloke, Albert Einstein is not rich, Newton Isaac is bankrupt poor on south sea bubble, Wright brother is poor, we often read about how great are scientist on the textbook who create useful invention to improve life, but there is a catch, the textbook conveniently never mention the scientist personal wealth, it’s apparent textbook censor the information they do not want the kids to know all the scientist are living paycheck to paycheck and borderline poor, where they often has to wagecuck and sell their IP to the government to make a living, if they failed to create any IP they would be rejected just another bloke we often see on the street today, is homeless educated guy not often in the past?

Friedcat of the bitcoin is the modern day jobless highly educated genius, he is often regarded as “genius youth who is living a frugal life”, despite awarded with scholarship, and secure the top spot in the top business school, the guy goes on and create very useful product, create the asicminer, but very quickly the guy just simply goes broke and fall into endless debt burden, his company is broken, life broken and going missing forever after he couldn’t pay the debt he owned, oh how ironically he is just the modernise Newton Isaac in disguise, such a nice addition, so guy listen, keep following the advice of go to school and study hard get good grade, get a good paying job with benefit, you would eventually made it in life, miraculously and magically you would be living happy ending life, it’s fine guy!

Then I’m often getting bombarded with doubt “Do you have a better system than existing one? Do you?” Obviously I don’t have any and I would never come up with one, keep trying to beat the house and to realise how great/lesser a person you are.

House price is soaring, but finance advisor telling me to debt maxxing on house loan 90% loan and 0~10% dp, and it’s fine. Because bank want to increase revenue, increasing house price is what the bank did, by increasing house price, guy would take more loan to buy house, that way bank can increase revenue by increasing house price and increasing the loan to buy house, then bank can charge interest on the house loan to make profit. But what I often heard is guy tell me to debt maxing on house loan, don’t care about saving, it’s a recipe to disaster to me. So guy today hope the house price to collapse and they can shop house on the bargain, that’s one wishful thinking, the bank cartel and house developer wouldn’t allow that to happen, reduce house price would make it bad for bank to sell more house loan, and bad for developer too, the blackrock would stop that effort, however as usual some guy would loss everything due to greed, if over leveraged on house loan, would loss everything.

Indeed, buying house is a forced saving as we all need a house where we can live peacefully with our family and build lifetime memories without fear of paying rent every month and no fear of frequent rental increase which adds extra burden on our budget. Furthermore, buying house is also considered a secure & profitable investment, particularly in countries where demand of houses is growing due to higher population growth which is the main cause behind soaring prices of homes.

[xSkylarx]

~snip

Indeed, buying house is a  forced saving as we all need a house where we can live peacefully with our family and build lifetime memories without fear of paying rent every month and no fear of  frequent rental increase which adds extra burden on our budget. having said that, buying house is also considered a secure investment, particularly in countries where demand of houses is higher due to higher population growth which is the main cause behind soaring prices of homes.

This changed my perspective on life; I'm not sure where they got it, but they said that a house is a liability and not an asset because you will spend a lot of money on it and renovate it to make it nice. Still, then there are no returns, which I could say is true because you can live in a house as long as it has a roof and isn't as fancy as we imagined, but when it comes to selling it in the future, I would say that you can sell it for and earn huge profit from it.

[kennycarder]

House price is soaring, but finance advisor telling me to debt maxxing on house loan 90% loan and 0~10% dp, and it’s fine.

This is all wrong here.

House prices are not soaring, it is exactly the opposite. Interest rates are high , less people can afford a loan because it is expensive now. So less people buy houses , less demand = lower price.

Anyone should be careful about making debts now as interest rates are rising all over the world.

Real estate is a powerful liability for most people. When the economic crisis comes, real estate is like a soap bubble. The moment it bursts, it is another beautiful rainbow. But it's what people need, so it's a vicious circle in the end.

[bestcoins1]

The house is certainly an important thing to be able to control expenditure, only by at home, expenses can be eliminated, if we leave the house then there is always something we want to buy, teach the family about effective ways to save by making the house as the most comfortable place and make everyday happy.

Just sitting and staying at home also requires spending because every family in the house also needs food to eat every day even though it can be controlled properly. Which means expenses will still exist and cannot be avoided even though they can be controlled because when a person is still breathing and still living in this world, he always needs expenses to eat and drink for his survival and that regardless of where he lives.

[Broly46]

If you would need to ask, what stage we are having right now today. I had observed first handed experience the situation from the 2007-2009, from the feeling alone I can tell the people today are getting a bit savage and aggressive, from my memory that I can recall is people are kinda aggressive priori to 2007, and they peak on 2008 when thing begin to breaking and massive layoff and also a lot of business goes broke and closure, by 2009 I’m reading a lot of people commit mass suicide, I mean it people killing themselves and en mass killing it’s not joking btw. From the feeling today and the people I observe and also the recent Meta layoff 11k employee and major tech layoff, I believe we are yet to reach the reminiscence of the 2008, we haven’t peak the market cycle yet, it might take much longer, I want to see people dead, not that I’m evil, it’s what I recall in 2008, you might want to read the book written by Robert Kiyosaki I think he record and describe the atmospheric pretty concise, not very best but I believe he is the only one person actually trying to record every piece of the detail in a book, by the time a lot of people are totally unaware of what future they’re facing and doing every survival of the fittest living, until they burn out and they finally collapse and take their own life, let’s wait and see if the history does repeat itself, I’m not going to advice anyone to make any money decision right now, especially on house investment, the market might shock you unexpectedly, and you would be the one commit suicide when you’re found yourselves in a dead end debt burden, so proceed diligently and extremely careful, it’s not fun to live in society today, the stress and pressure level is overwhelming even to me, I’m starting to get some nerve from the atmospheric right now, it’s frightening and I’m not entirely sure which nation would be the one to fall just like the reminisce of 2008, is it very bad? Let’s see the dead toll will be record high, much higher than the 2008 equivalent.

[Smartprofit]

A house (real estate) is, in fact, just a concrete box.  

The price of this concrete box can drop sharply and heavily.  A war may break out in the country and the house may be destroyed.  You may have to urgently flee abroad and sell your house for next to nothing.  

In addition, it is very important to understand that you do not own property, but the right to property.

Legislation can be changed and your home will be confiscated.  The tax on and property payable can skyrocket.  The price of utilities can also rise very strongly.  

A home is not always a great investment.