Owning vs Renting: the basic economics

[scubascuba3]

Sure, renting is great if you like giving your money away to another person for their own needs. So you're saying that only irrational people purchase houses? Sometimes I wonder how you guys rationalize life in general....

Have you read the posts about the alternative uses of the money? Seems you missed them.

[mcfish]

I hope it's not in the current downward spiral of stock markets

Sent from my SC-01D using Tapatalk

[jpinx]

I hope it's not in the current downward spiral of stock markets

Sent from my SC-01D using Tapatalk

Stock markets and property values tend to follow each other, maybe a bit out of step, but in the long haul it's pretty close

[mcfish]

I hope it's not in the current downward spiral of stock markets

Sent from my SC-01D using Tapatalk

Stock markets and property values tend to follow each other, maybe a bit out of step, but in the long haul it's pretty close

Not in Asia. The Last global stock market collapsed because of the over inflated USA property market but thailand and Australia and others completely unaffected

Sent from my SC-01D using Tapatalk

[papayasalad]

if you like karaoke music and barking dogs all night, buy!

if not, rent.

[elgordo38]

How does an investor of financial instruments in the West insure against money printing by the government? ?

He reads the statement on the printed money "In God We Trust" Good as gold well no not really. I saved my money all my life like the government said I should and look where that got me. Also no COLA and a depreciating dollar in one of the finest countries in the world. To sum it up there is no insure, insurance. Get in line now there is an election campaign going on. Take your liar meter with you the needle should bounce off the walls. Getting back to the topic I would never ever buy here not even a car. With the present government in power it seems all downhill for us expats.

[jpinx]

I hope it's not in the current downward spiral of stock markets

Sent from my SC-01D using Tapatalk

Stock markets and property values tend to follow each other, maybe a bit out of step, but in the long haul it's pretty close

Not in Asia. The Last global stock market collapsed because of the over inflated USA property market but thailand and Australia and others completely unaffected

Sent from my SC-01D using Tapatalk

Agreed -- and that exemplifies the difficulty in comparing investment and rent, to property ownership across different people's home-country's situation compared to Thailand.. Very mixed equation and needs to be done carefully by the individual according to his own needs

[mcfish]

if you like karaoke music and barking dogs all night, buy!

if not, rent.

And walk away from 3 months security deposit every time you hear a dog bark?

Sent from my SC-01D using Tapatalk

[jpinx]

if you like karaoke music and barking dogs all night, buy!

if not, rent.

And walk away from 3 months security deposit every time you hear a dog bark?

Sent from my SC-01D using Tapatalk

If you are renting there is a much better chance of "fixing" anti social behaviour because there will probably be other renters with the same complaint, and a landlord will feel the pressure to actually do something. Try that as a lone farang house-owner

Also -- There have been some horror stories about people buying unwisely and things like cement works opening up on their back door .... (see above)

[mcfish]

if you like karaoke music and barking dogs all night, buy!

if not, rent.

And walk away from 3 months security deposit every time you hear a dog bark?

Sent from my SC-01D using Tapatalk

If you are renting there is a much better chance of "fixing" anti social behaviour because there will probably be other renters with the same complaint, and a landlord will feel the pressure to actually do something. Try that as a lone farang house-owner

Also -- There have been some horror stories about people buying unwisely and things like cement works opening up on their back door .... (see above)

hmmm a Thai landlord feeling pressure? hmmm..okay...

[jpinx]

if you like karaoke music and barking dogs all night, buy!

if not, rent.

And walk away from 3 months security deposit every time you hear a dog bark?

Sent from my SC-01D using Tapatalk

If you are renting there is a much better chance of "fixing" anti social behaviour because there will probably be other renters with the same complaint, and a landlord will feel the pressure to actually do something. Try that as a lone farang house-owner

Also -- There have been some horror stories about people buying unwisely and things like cement works opening up on their back door .... (see above)

hmmm a Thai landlord feeling pressure? hmmm..okay...

If you can get some Thai tenants to do the complaining,,,,, yes. I'm lucky I am good friends with the landlord and landlady now, so I can get things done myself.

[NeverSure]

The two QE by the Feds is not money printing?

QE is easing, not printing.

1. Interest rates were lowered (eased) to encourage borrowing and investing not just in homes which were in the tank, but in business and consumer goods.

2. Bank lending requirements were eased by lowering the reserve requirements. Banks were able to lend a higher percentage of their depositors' money.

It had nothing to do with printing. No additional USD were "printed". If it had been, inflation would have skyrocked but instead it went down.

Take note that the main component of ending QE is discussed as the Fed raising interest rates.

Cheers.

[trogers]

The two QE by the Feds is not money printing?

QE is easing, not printing.

1. Interest rates were lowered (eased) to encourage borrowing and investing not just in homes which were in the tank, but in business and consumer goods.

2. Bank lending requirements were eased by lowering the reserve requirements. Banks were able to lend a higher percentage of their depositors' money.

It had nothing to do with printing. No additional USD were "printed". If it had been, inflation would have skyrocked but instead it went down.

Take note that the main component of ending QE is discussed as the Fed raising interest rates.

Cheers.

When does the Feds have money to buy back government debts if not creating out of thin air? That's printing money...

[NeverSure]

The two QE by the Feds is not money printing?

QE is easing, not printing.

1. Interest rates were lowered (eased) to encourage borrowing and investing not just in homes which were in the tank, but in business and consumer goods.

2. Bank lending requirements were eased by lowering the reserve requirements. Banks were able to lend a higher percentage of their depositors' money.

It had nothing to do with printing. No additional USD were "printed". If it had been, inflation would have skyrocked but instead it went down.

Take note that the main component of ending QE is discussed as the Fed raising interest rates.

Cheers.

When does the Feds have money to buy back government debts if not creating out of thin air? That's printing money...

You are sorely confused and really need to...

"The Federal Reserve purchases Treasury securities held by the public through a competitive bidding process. The Federal Reserve does not purchase new Treasury securities directly from the U.S. Treasury, and Federal Reserve purchases of Treasury securities from the public are not a means of financing the federal deficit.

In financing the federal deficit, the federal government borrows from the public by issuing Treasury securities which are sold at auction according to a schedule that is published quarterly." LINK

[jpinx]

The two QE by the Feds is not money printing?

QE is easing, not printing.

1. Interest rates were lowered (eased) to encourage borrowing and investing not just in homes which were in the tank, but in business and consumer goods.

2. Bank lending requirements were eased by lowering the reserve requirements. Banks were able to lend a higher percentage of their depositors' money.

It had nothing to do with printing. No additional USD were "printed". If it had been, inflation would have skyrocked but instead it went down.

Take note that the main component of ending QE is discussed as the Fed raising interest rates.

Cheers.

When does the Feds have money to buy back government debts if not creating out of thin air? That's printing money...

https://en.wikipedia.org/wiki/Quantitative_easing

and...

http://www.economist.com/blogs/economist-explains/2015/03/economist-explains-5

......... a little less USA-centric

Short answer from the economist article ,,,,

"To carry out QE central banks create money by buying securities, such as government bonds, from banks, with electronic cash that did not exist before."

[Naam]

A 5% annual return over the next 10 years is a rather optimistic scenario so it would only be fair to compare this opportunity cost with a similarly optimistic property appreciation model.

Furthermore, for those who have enough money to buy property, they might already have a large sum invested and are interested in diversification rather than putting all their eggs in a single basket.

Actually not optimistic. You can get over 6% fixed term 5 years if you look carefully, with credit ratings too.

most probably with a CCC credit rating. globally there's presently no fixed term investment available that yields 6% p.a. and has an investment grade rating.

[beachproperty]

O.K.! O.K.!....You convinced me!

I shouldn't have bought my Bangkok house for 3.5 million Baht (which is now worth 5 million baht)

I shouldn't have invested in a beach front 2 bd townhouse for 2.2 million baht (and later sold it for 4.5 million baht)

I shouldn't have then invested in beach front land and built 6 one bedroom 2 bath units for 9 million (now worth at least 25 million)

Whoa is me ....what am I going to do? ....RENT, RENT, RENT is my manta

I think I'll get a job teaching!

[jpinx]

A 5% annual return over the next 10 years is a rather optimistic scenario so it would only be fair to compare this opportunity cost with a similarly optimistic property appreciation model.

Furthermore, for those who have enough money to buy property, they might already have a large sum invested and are interested in diversification rather than putting all their eggs in a single basket.

Actually not optimistic. You can get over 6% fixed term 5 years if you look carefully, with credit ratings too.

most probably with a CCC credit rating. globally there's presently no fixed term investment available that yields 6% p.a. and has an investment grade rating.

You bad boy - you didn't do your homework ! Check the NZ finance world

[jpinx]

O.K.! O.K.!....You convinced me!

I shouldn't have bought my Bangkok house for 3.5 million Baht (which is now worth 5 million baht)

I shouldn't have invested in a beach front 2 bd townhouse for 2.2 million baht (and later sold it for 4.5 million baht)

I shouldn't have then invested in beach front land and built 6 one bedroom 2 bath units for 9 million (now worth at least 25 million)

Whoa is me ....what am I going to do? ....RENT, RENT, RENT is my manta

I think I'll get a job teaching!

Apples and pears..... buying costs and selling prices are only part of the equation, but if it works for you, that's great Just don't ram it down everyone else's throats

[beachproperty]

O.K.! O.K.!....You convinced me!

I shouldn't have bought my Bangkok house for 3.5 million Baht (which is now worth 5 million baht)

I shouldn't have invested in a beach front 2 bd townhouse for 2.2 million baht (and later sold it for 4.5 million baht)

I shouldn't have then invested in beach front land and built 6 one bedroom 2 bath units for 9 million (now worth at least 25 million)

Whoa is me ....what am I going to do? ....RENT, RENT, RENT is my manta

I think I'll get a job teaching!

Apples and pears..... buying costs and selling prices are only part of the equation, but if it works for you, that's great Just don't ram it down everyone else's throats

LIKE YOU!!!!! .......As they say "you can lead a horse to water, but you can't make him drink it"

[jpinx]

O.K.! O.K.!....You convinced me!

I shouldn't have bought my Bangkok house for 3.5 million Baht (which is now worth 5 million baht)

I shouldn't have invested in a beach front 2 bd townhouse for 2.2 million baht (and later sold it for 4.5 million baht)

I shouldn't have then invested in beach front land and built 6 one bedroom 2 bath units for 9 million (now worth at least 25 million)

Whoa is me ....what am I going to do? ....RENT, RENT, RENT is my manta

I think I'll get a job teaching!

Apples and pears..... buying costs and selling prices are only part of the equation, but if it works for you, that's great Just don't ram it down everyone else's throats

LIKE YOU!!!!! .......As they say "you can lead a horse to water, but you can't make him drink it"

And a very good morning to you too

[Naam]

A 5% annual return over the next 10 years is a rather optimistic scenario so it would only be fair to compare this opportunity cost with a similarly optimistic property appreciation model.

Furthermore, for those who have enough money to buy property, they might already have a large sum invested and are interested in diversification rather than putting all their eggs in a single basket.

Actually not optimistic. You can get over 6% fixed term 5 years if you look carefully, with credit ratings too.

most probably with a CCC credit rating. globally there's presently no fixed term investment available that yields 6% p.a. and has an investment grade rating.

You bad boy - you didn't do your homework ! Check the NZ finance world

i was talking about major currencies and not Kiwi/Lamb Chop-Dollars

6% Kiwi yield vs. 0% USD and GBP yield = a zero sum game (last two years)

[jpinx]

most probably with a CCC credit rating. globally there's presently no fixed term investment available that yields 6% p.a. and has an investment grade rating.

You bad boy - you didn't do your homework ! Check the NZ finance world

i was talking about major currencies and not Kiwi/Lamb Chop-Dollars

6% Kiwi yield vs. 0% USD and GBP yield = a zero sum game (last two years)

As they say here -- up to you

Turning your nose up at 6.6% fixed for 5 years in todays market shows a level of financial arrogance that normal people can not afford.

[beachproperty]

most probably with a CCC credit rating. globally there's presently no fixed term investment available that yields 6% p.a. and has an investment grade rating.

You bad boy - you didn't do your homework ! Check the NZ finance world

i was talking about major currencies and not Kiwi/Lamb Chop-Dollars

6% Kiwi yield vs. 0% USD and GBP yield = a zero sum game (last two years)

As they say here -- up to you

Turning your nose up at 6.6% fixed for 5 years in todays market shows a level of financial arrogance that normal people can not afford.

You can't argue with ignorance!

[huawei]

most probably with a CCC credit rating. globally there's presently no fixed term investment available that yields 6% p.a. and has an investment grade rating.

You bad boy - you didn't do your homework ! Check the NZ finance world

i was talking about major currencies and not Kiwi/Lamb Chop-Dollars

6% Kiwi yield vs. 0% USD and GBP yield = a zero sum game (last two years)

As they say here -- up to you

Turning your nose up at 6.6% fixed for 5 years in todays market shows a level of financial arrogance that normal people can not afford.

Exchange risk?

[jpinx]

i was talking about major currencies and not Kiwi/Lamb Chop-Dollars

6% Kiwi yield vs. 0% USD and GBP yield = a zero sum game (last two years)

As they say here -- up to you

Turning your nose up at 6.6% fixed for 5 years in todays market shows a level of financial arrogance that normal people can not afford.

Exchange risk?

What exchange? Oh -- if you're in some world-dominating currency you'll get diddly-squat for terms, but around the peripheries where the rules are the same and the security is just as good, some of us are doing very nicely -- thank you.. ....

[beachproperty]

i was talking about major currencies and not Kiwi/Lamb Chop-Dollars

6% Kiwi yield vs. 0% USD and GBP yield = a zero sum game (last two years)

As they say here -- up to you

Turning your nose up at 6.6% fixed for 5 years in todays market shows a level of financial arrogance that normal people can not afford.

Exchange risk?

What exchange? Oh -- if you're in some world-dominating currency you'll get diddly-squat for terms, but around the peripheries where the rules are the same and the security is just as good, some of us are doing very nicely -- thank you.. ....

What exchange?.....Well if your getting 6% on your New Zealand investment and the exchange rate is 23.74 today ......You would have lost money when you invested as the exchange rate was over 28 a little over a year ago. You do the math!!!

[papayasalad]

6%? in your dreams....

70 percent of people lost money in 2015.

and about these people who said my house worth double now... how you know, maybe in your dream. , did you sell it?

try to sell it to a Thai. he will say" why I should pay more for your house when I can build my own house for much cheaper than yours.? "

[jpinx]

What exchange? Oh -- if you're in some world-dominating currency you'll get diddly-squat for terms, but around the peripheries where the rules are the same and the security is just as good, some of us are doing very nicely -- thank you.. ....

What exchange?.....Well if your getting 6% on your New Zealand investment and the exchange rate is 23.74 today ......You would have lost money when you invested as the exchange rate was over 28 a little over a year ago. You do the math!!!

If someone had done as you say, then they would have lost money.

I didn't do that

[jpinx]

6%? in your dreams....

70 percent of people lost money in 2015.

and about these people who said my house worth double now... how you know, maybe in your dream. , did you sell it?

try to sell it to a Thai. he will say" why I should pay more for your house when I can build my own house for much cheaper than yours.? "

Not 6% -- I checked this morning and it's 6.6% - but no use if you are in US$ or Euros or some other world-dominating, low-performing currency