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>All in all I did lost some money, but that is part of rental properties, that is not CD (Certificate of Deposit) with fixed interest. Like most investments, it
by Arizhel 10y ago
>All in all I did lost some money, but that is part of rental properties, that is not CD (Certificate of Deposit) with fixed interest. Like most investments, it incurs some risks too.
But are they worth it? Unless you're making a really large profit, it seems like you're far better off just putting your money into an S&P500 index fund or other stock funds. With a stock fund, all you have to do is put your money in there, and wait. With a rental house, you have to deal with repairs, collecting rent, using the legal system when tenants don't pay, etc. Unless you're making a 100% profit, I fail to see how rental property makes any sense as an investment at all in that environment.
- HeyLaughingBoy 10y agoOne word: leverage. While your $50k investment is making 6% ($3,000/yr) interest in an index fund, my $50k downpayment on a $500k house is making average of 6% ($30,000/yr) equity growth. And I get to deduct the mortgage interest, taxes and maintenance costs of the house while someone else pays most of the mortgage. I should really have kept that property...
- Arizhel 10y agoYou seem to be assuming that property values are rising. The 2008 crash proves that's something you can't count on.
- HeyLaughingBoy 10y agoIf you look at a few years out of the last 5 decades, sure. If you look at the trend over decades, which is the timescale I'd expect to be looking at for a real-estate investment, yes, prices are rising.
- deleted 10y ago[deleted]