Money is too valuable to invest in a home


Baris ERKAYA

According to REIDIN-GYODER’s New Home Price Index for June, the down payment rate in branded housing sales has increased to 68 percent. Historically, the use of loans in housing purchases is at the lowest level, and the use of down payment is at the highest level.

We are in the times when the cost of money is the highest for those who want to buy a house. The days when the “Money in hand is the most profitable” strategy is at its peak due to increasing inflation.

You ask why?

The calculation is very simple. What needs to be calculated is the alternative cost of money.

WHAT 2 MILLION TL CAN DO

That is: If you consider on an annual basis the lowest risk and highest return that can be achieved in 1 year at the moment, in bonds or bills. If we consider a monthly high-yielding investment vehicle, it is in deposit. Let’s start with a 2 million TL house. The monthly net income you will get without bargaining is between 26 thousand TL and 32 thousand TL. What if we invest the same money in housing? For example, if you want a detached life close to the city, the options you have are almost non-existent. So, how many options are there if you rent a house with 26 thousand TL – 32 thousand TL per month, which will bring 2 million TL in deposits? Countless.

Let’s take it one step further. The payback period for an average residential investment in Istanbul is between 23-26 years.

This means a monthly rental income between 7 thousand 246 and 6 thousand 410 TL for a 2 million TL residence.

Let’s deduct this from the interest income to be obtained from the deposit interest. We have added the rental income that we would have obtained if we lived in a detached house with a rent between 19,500 TL and 25 thousand TL, and on top of that, we bought the house. This will also give you compounded interest, as it will increase the amount of your money each month. We haven’t even deducted other non-stop lump sums, such as peaked real estate taxes, for each house you will buy from this account.

WHEN YOU HAVE TO BUY 3 FROM THE SAME HOUSING

● The situation is even worse in an investment property. If 2 million TL is deposited, it will pay for itself in 6.5 years at worst, in 5 years and 3 months at most. There is an opportunity to buy at least 3 more from the same residence you will get halfway, during the self-depreciation period. The fact that the use of credit from these phases is dp and the use of down payment has reached peak in the house sales statistics announced in K shows the demand of those who invest in their third or maybe tenth house and foreigners whose money has increased to several millimeters in TL compared to previous years. Let us remind you that in both options, 2 million TL remains in your pocket. So when will it make sense to buy a house? Of course, when annual phases drop below 10 percent annually again, or when housing rate multipliers get out of these crazy prices and drop to sensible levels. This is, of course, a situation entirely focused on inflation. If inflation drops markedly, and housing manufacturers stop reflecting the phase decline they have been doing for years on housing prices, then it probably won’t be difficult to find a home that everyone can afford. But this will take some serious time.


Source: Dünya Gazetesi by www.dunya.com.

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