Buy or Rent ? The FINAL ANSWER.

Are you trying to decide between buying or renting a house? You're not alone! This is a common dilemma faced by many people. However, with the rise of social media influencers, it's important to be wary of half-knowledge when it comes to real estate advice.

In this video, we'll dive into the pros and cons of buying vs renting a home and dispel some of the common myths perpetuated by influencers.

Don't fall for half-truths and misinformation. Watch this video to get the full picture of whether buying or renting a house is right for you and how real estate also can be a solid investment option for your financial future.

00:00 - Introduction
01:26 - How did it all start?
03:19 - Truth nobody tells you about buying a house
04:55 - Right time to buy a House
06:48 - Buy a house in less than 10 years!
08:02 - Reason you can’t buy a house by investing in stocks
09:41 - How can you earn money by taking a Loan?
12:11 - Watch this before you invest your money
14:45 - My Capital Allocation strategy!
15:47 - Conclusion

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[Writepranab]

My experience
I was in rented accommodation for 8 years 3+3+2 yrs at three different flats. Most problematic was shifting. I had no problem but I had to shift because owner wanted to sell it. Then I purchased the flat where I was in rent. Didn't have money for downpayment, so took 100% loan. Now my ~40% salary goes to EMI, a bit financially stressed. This is a 15 yrs old flat and after 20yrs loan period it's resell value will be nothing. But still I don't regret it. This is not an investment but I have bought peace of mind, I don't have to shift, my wife can hang a fancy wall clock wherever she wants, can install an AC and needn't take any permission to make an hole in the wall.

[Lucky.assertive]

I bought the house 7 years back and now am loan free and blessed ! Home is important

[bukki]

To keep up with rising cost we are beginning to see the equity of our home for what it truly is, Its becoming hard for us seniors not to ask the obvious question: Should we cash in, invest the money, and rent?

[rahulraj]

*Bought a home few years back with a emi of 24k. Constructed 2 shops in front with rental yield of 8000. Given the upper portion on rent on 4000. 50% of emi is coming from home itself. Your first property should be a house & second one would be commercial. Always calculate the return before buying 🙏*

[SanjeevPrasad]

Rent/Buy depends on your life partner ❤

[lachitdutta]

One more thing people forget is that every year salary increases around 8-10%, which brings down the EMI-Salary %. After 10 years the EMI becomes very small compared to salary. Whereas the Salary-Rent % remains somewhat constant.

[olgageorgsen]

With markets tumbling, inflation soaring, the Fed imposing large interest-rate hike, while treasury yields are rising rapidly—which means more red ink for portfolios this quarter. How can I profit from the current volatile market, I'm still at a crossroads deciding if to liquidate my $125k bond/stock portfolio

[prediator]

I beg to differ a little.. whatever you said is partially right. While calculating the return on home, it is important to understand that it does not matter how much appreciation you get on your property, you cannot leverage it until that property is for investment purpose and you are not residing there.

If you are living there, it could give you 10X return and it still wont matter. And you will spend almost your entire youth under the burden of emi and fear of job loss.

Solution: Buy a piece of land in a remote area where land prices are extreemly low and keep staying in a rented apartment. You have to pay 1/3rd of the emi of a flat. And you could still save some money. After 15-20 years, build the home and live happily after retirement.

[rowoflamps]

I have never seen person as much as true as you are sir . I can't explain in word how much you are helping people's lives ❤

[missrooney]

Honesty and Simplicity is a new "cool" bcoz of you Pranjal😊

[curiousindori]

I personally feel that buying and renting simultaneously is the right option. Buy where you estimate that the best capital appreciation can happen and rent where and how you might want to live. If someone is lucky, they might overlap and they will save a ton of transaction cost and gain significant freedom.

The major benefit of splitting these into two is that the options of properties you can buy increases greatly. For ex - I prefer to stay near my current office, where capital appreciation might not be great but I can buy a flat in my home town where possibilities of capital appreciation are much better.

[SajalAgarwal]

Nice video

I live in metro city Noida
Let me list some more minus points of buying a house

1. 70K Emi means your income should be 3 lakhs per month (if you give 25% of salary in emi) . This is not normal generally.
2. Loan will create burden on mind. Fear.
3. 20 - 25K emi mei Metro city mei 2 BHK bhi mushkil se ayega.
4. Liquidity gone if you invest in House and you spend like a kanjoos.
5. After 20 yrs house will be degraded and you want to buy a new house.
6. If you change your job location you can change your home location easily if you are on rent.
7. Flat appreciation is less.

[pranitgandhi]

Thank you Pranjal! This video was really helpful for me as I had purchased my new home a year back, was going through the home loan documentation process, and each day after watching these so called financial influencer's opinions, I used to self-doubt my decision to buy real estate. This video gave me a lot of clarity.

[dibyajyotikoch]

I really appreciate your work, but i saw few wrong assumptions in this video:

1] Rent will increase 6-7% every year, but EMI will be constant for 20 years.

Reality: Rent may or may not increase every year. It may remain constant for couple of years as well (happened with my case). You can bargain the rent increase and in case it doesn't suit you, you always have the option to change your house. On the other side, in 2022, the bank has increased the home loan interest rates multiple times from 6.5-7% to 9-9.5%. So in this case your EMI might have increased 2-3 times in a single year.

2] Real estate capital appreciation is 10-12%

Reality: Your house's capital appreciation depends on multiple factors. But on average, based on multiple research, Real estate capital appreciation is 3-5%.

[durgarao]

I live in a rented house, which cost around 1 cr, and I pay 10 k per month. I think it is better to pay rent we get this kind of cool deals😊

[factzfactory]

My dad had bought a house for 4.5 lac in 2004 when i was born and today it's price is more than 35-40 lac. I belive in real estate

[alokguptaY]

Also deduct ~25K from your EMI expense while doing all these calculation because you are not going to live in road, anyway you need space to live in...
Thanks for this detail video, this might have clear doubts for so many people

[adi]

From where you got 11 percent returns. The problem in real estate is most returns happens beween 2 years before posession to next 4-5 years. After that you will stuggle to get even 5 percent return even after rental yield. So timing becomes very important in real estate.

[swarajkumardas]

A house should always be bought but one thing to keep in mind is to buy a house within your income capacity. When you sell the house it will also return your money

[akashdesarda]

One of the most important non capital, non money related reason is that once you buy a home you can't easily move to other location & maybe hamper your growth. That's why I always says that buying a home makes much more sense after 35+ age when you know that you won't be moving to other location just like that.