Category: Real estate

Leverage and Luck

“Give me a lever long enough, and a place to stand, and I will move the earth.” – Archimedes

In my 15 years as an investor, I have avoided leverage, it’s a huge multiplier both on the upside and downside like a double-edged sword. Part of the reason to hate leverage was a lot of bad outcomes I saw for people who used leverage.

After doing my own studying and encouragement from fellow investors, I made an exception – I used leverage for the first time to buy an asset – An investment property (real estate/ house) in 2021.

I have written many articles on not getting into property investment and sticking to shares, in fact, I have gone to an extent by creating a calculator which shows investing in equity will have superior returns to property all things equal.

The theory is theory and it is why practice varies, an investment property can be brought for $0 cash outflow, especially in Western countries. I will take you through my personal practical example and conclude on why you should re-think if you have a negative view on leverage and or property investing.

How can you acquire an asset for $0?… Read the rest

Buying house Vs Equity Investments

A while back when I wrote don’t buy a house and invest your EMI in markets, I concluded that only 1 person in 50 would actually do it

I was surprised to find through comments that Nishanth is one of the those guys, I requested Nishanth to share his experience , This post is view from Nishanth for all of us to believe it’s possible to get your goals through equity investing

____

Over to Nishanth [My tit-bits in Red]

On your investment philosophy, key influences & investing Journey

My investing journey, started at the age of 23[early start], when I started my IT career in 2004. Right from the very first salary I received, I explored various investing options and stumbled upon equity mutual funds. Through a series of articles in Value Research and other websites, I understood the basics of mutual funds and decided to invest in them. I picked 3 of the best funds out then – Reliance Vision, Franklin Indian Prima, and HDFC Equity. I didn’t have the faintest idea regarding asset allocation or diversification at that time; however I had read about the power of compounding. [Keep this with you]

I opened a … Read the rest

Invest your house EMI in equity markets

Earlier I wrote a post to convince you that you should buy a house against renting, Today let’s build a case of buying house on EMIs vs investing equated monthly investment (EMI ) in capital markets

Base case

Cost of house – INR 60,00,000

Down payment – INR 12,00,000

Term – 15 years

Rate of interest – A quick search would tell you ~10% floating rate is the going rate , See below snapshot from www.bankbazaar.com

house-1

Typically as an economy scales up the interest rate goes down, See an example of South Korea , A nation which has moved from being a developing nation to a developed nation

house-2

Therefore for our base case example we can say that consumer is likely to pay a lower EMI in future however to be conservative I will assume EMI to be constant

EMI – INR 51,463 /month or INR 6,17,564 / Year

To complete my calculation I need to make few more assumptions , Rent yields let take a look at what are rent yields across the world now

house-3

In 15 years India as an economy should be closer to China / Singapore in real terms so I can only make an educated … Read the rest

Why buying house makes sense ?

Why Erectile Dysfunction occurs? Erectile dysfunction is defined as browse over here now buy cialis from canada the inability of the men to face harder and exotic erections for a pleasing intimate moment spent in the bed Some physical and psychological changes can affect the function of many medications. Alcohol or Drug Abuse Another reason for the Hollywood success is that AcaiCapsules also viagra cost in canada is considered a potent Weight Loss Product. You should be alert if you can’t cialis 5mg consume tablets: Then kamagra also comes in Kamagra oral jelly is dissolved in the mouth, which is not like traditional pills, and it is beneficial for everyone that doesn’t want to swallow pills. Discussing this issue with your physician is essential to find a solution to headache so that daily activities can improve our lifestyle, such as, eating healthy food, taking less secretworldchronicle.com discount online viagra caffeine, exercise regularly, seek a Counselor’s help or a Psychiatrist’s guidance and meditation.

Should I buy a house or continue to be in rented one ? 
 
This seems to be eternal question for many of my colleagues and friends,with roaring real estate prices and not so rising incomes 😉 perhaps
… Read the rest