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Well, but after 30 years, when you retire the place is yours own and your monthly payment goes down. Even if you saved that 100-150 euro every month, you'd not

Well, but after 30 years, when you retire the place is yours own and your monthly payment goes down. Even if you saved that 100-150 euro every month, you'd not afford buying it after 30 years, assuming it stayed at the same price-point. On the other hand, it is hard to believe you can rent a 200k€ place for 500€/m. In Warsaw, a 2-room 40-50 m² apartment in the city center costs about 400-500€/m to rent, but if you wanted to buy it, offer prices start below 100k€.

xyzzyz 11y ago
While Berlin is a bit special case with its housing supply, renting is actually crazy expensive in Poland. You should compare the prices to e.g. Lithuania or Estonia, the difference in affordability is mindblowing.
ido 11y ago
On the other hand, it is hard to believe you can rent a 200k€ place for 500€/m. In Warsaw, a 2-room 40-50 m² apartment in the city center costs about 400-500€/m to rent, but if you wanted to buy it, offer prices start below 100k€. Believe it! Or look at http://www.immobilienscout24.de/ http://www.immobilienscout24.de/ for Berlin (in the combo box right of the search field "kaufen" means buy and "mieten" means rent - pick the first option in both). There are places that are unusual (like Mitte - the center of the city), but for ~90%+ of Berlin the pattern I described above more or less holds.
ido 11y ago
Even if you saved that 100-150 euro every month, you'd not afford buying it after 30 years, assuming it stayed at the same price-point. The thing is that many people don't have an extra 150 euros per month (not to mention ~50k euros for the down payment) to save or invest in a mortgage, they spend everything they earn every month even when renting. If you're in a position where you have extra money and you can choose whether to invest it in the stock-market, buy a nice car, or put a down-payment+mortgage on a place to live it's a different consideration.
- pkolaczk 11y ago
  This is the point I was making: renting is the only choice if you can't get a safe mortgage with good terms. And getting a mortgage with monthly payment X, when you could hardly pay more than X would be a very risky option and even if some (crazy) bank agreed to it, they would set a very high interest rate for covering the risk. But getting a mortgage with a monthly payment X when you can really afford 4X is a totally different story.

xyzzyz 11y ago

While Berlin is a bit special case with its housing supply, renting is actually crazy expensive in Poland. You should compare the prices to e.g. Lithuania or Estonia, the difference in affordability is mindblowing.

ido 11y ago

On the other hand, it is hard to believe you can rent a 200k€ place for 500€/m. In Warsaw, a 2-room 40-50 m² apartment in the city center costs about 400-500€/m to rent, but if you wanted to buy it, offer prices start below 100k€. Believe it! Or look at http://www.immobilienscout24.de/ http://www.immobilienscout24.de/ for Berlin (in the combo box right of the search field "kaufen" means buy and "mieten" means rent - pick the first option in both). There are places that are unusual (like Mitte - the center of the city), but for ~90%+ of Berlin the pattern I described above more or less holds.

ido 11y ago

Even if you saved that 100-150 euro every month, you'd not afford buying it after 30 years, assuming it stayed at the same price-point. The thing is that many people don't have an extra 150 euros per month (not to mention ~50k euros for the down payment) to save or invest in a mortgage, they spend everything they earn every month even when renting. If you're in a position where you have extra money and you can choose whether to invest it in the stock-market, buy a nice car, or put a down-payment+mortgage on a place to live it's a different consideration.

pkolaczk 11y ago
This is the point I was making: renting is the only choice if you can't get a safe mortgage with good terms. And getting a mortgage with monthly payment X, when you could hardly pay more than X would be a very risky option and even if some (crazy) bank agreed to it, they would set a very high interest rate for covering the risk. But getting a mortgage with a monthly payment X when you can really afford 4X is a totally different story.