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https://twitter.com/sirwembu/status/1264354104463237126?s=19 Rent vs Buy? Here's my opinion. Disclaimer, this isn't advice, these are my experiences. The experts like @iamkoshiek can correct me if I chat shit, or fill in the blanks / add context if needed [Thread]
Firstly, are you buying a property with any plan in mind, or just because someone said it's a "good investment" 
A family home for 15-20 years is fine, hoping you'll make a massive profit in 5-10 years...
A family home for 15-20 years is fine, hoping you'll make a massive profit in 5-10 years...
What I've notice is that in most cases, especially in an area where there is less demand, rent is slightly less than a bond repayment. So if the bond is 11k, the rent will probably be around 8k. Laughs in "rent is throwing away money"
So if you can't afford to buy, does that mean you should be homeless?
It's not that simplistic though. If property in the area you buy is in demand then it will work in your favour. Interest rates don't increase at the same rate as inflation, the bond repayments also become more affordable over time. But what about hidden costs...
When doing the buy vs rent comparison, very rarely do people mention the cost of transfers, lawyers, etc, which means you need between 50k-100k CASH, and you can't finance this. How many people have this type of cash on hand?
If you have managed to save that kind of cash, good job, buy yourself a good bottle on 1 June. Doesn't mean you should be blowing up estate agents phones looking to buy property. If it fits into your plan, then go for it...
Do people know that building insurance is compulsory and required by the bank to approve your bond? This is around R500 p/m to cover you for geysers, fire, disasters, etc.
Definition of "Investment" - "the action or process of investing money for profit". Based on this, my understanding would be that the house that I live in is not an investment, because it isn't making profit, but it's essential nevertheless.
If you are going to buy property as investment, then do exactly that. Years back I went to see this property for rent. A young guy and his brother inherited money and bought this place. I showed him water damage under the basin, his response was that the place is rented as is...
When I rented I didn't need to do any maintenance. I had to spend 60k on repairing rising damp on a previous property. On my current property I've spent over 100k to fix damp and plumbing issues. Ignore this and all you walls, wooden floors and cupboards will be damaged as well
Before signing an offer to purchase, there are companies that do inspections on the property, to protect the buyer. If I knew about this I may have shaved of around 150k of the selling price, more crying...
I would have never watched the movie Parasite if it hadn't won Oscar's, brilliant movie...
The book Freakonomics has a chapter titled "What do School Teachers and Sumo Wrestlers have in common?". A new chapter "What do Property Investors and Forex Traders have in common?" should be added, since they both only show you the profits and never the massive losses they take
Feel free to retweet if this was useful. I'm not trying to debate anything regarding this, so if people want to be hostile or argue about this...
