Specifically I have written 'CONS' of staying on rent becasue in this forum many of us had already mentioned about Pros of it like saving big amouont of money as renting is much cheaper as comapred to buying etc etc.

Which is definitely ture. But there are some practical difficulties in renting, becasue of which many people do not prefer it, even though it seems to be much cheaper.

People can share their views about CONS of renting. I am listing a few

1. Insecurity. Lanlord can ask you to vacate anytime (of course by giving 1 month notice). Then you have to search for another one, shift to that place which incurs a cost. In think avg time one stays on rent in a single property is not more than 2 yrs.
2. You can not decorate, create furniture as per your convenience / choice as the property is rented. In fact you have to get permission from land lord to drill a single hole in the wall
3. Society people will always give you substandrad tratment even though you are paying equal maintenance. I have seen in my Friend's society all people staying on rent were asked to park their vehichle outside becasue of sapce issue in common parking area.
4. You will never have a feeling of your 'own' home. I know this is emotional factor & has no place in rational thinking. But in India at least it is seen with many (or most?) people. Nothing very wrong in that if you see the culture here.
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  • Originally Posted by veeemkay
    But Women to me are complex to understand... wait i am digressing from the topic.


    Correction, a women is impossible to understand. :D:D
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  • Originally Posted by RAJESHP
    Very valid cons of renting. I would add one more to add some where in the middle of your list of cons:

    1) Rent paid is lost, EMI's are paid towards your property.

    Its very very very important to realise that, all these cons should be thought of when market is sane. We had this crazy run up and prices are illogically high. This factor overrides all the cons of renting and makes renting desirable and logical right now.

    If you are saying that today's buyers are buying because of these cons of renting, I totally disagree.

    I can bet, every buyer today feels below, almost, no exceptions!


    1) Prices do not fall or if they fall, it will be max 10-15%
    2) This price fall, if at all it happens, will recover itself in 1-2 yrs.
    3) Since I do not have to sell my property, this really does not make any difference to me.

    These buyers of today, use this cons to justify their buying, because their numbers just don't add up.

    I can bet on this. There is no single buyer in today's market, who feel prices are going to crash for good, and still want to buy because of cons of renting. There is hardly any emotional factor when we are taking of investing +40L amount.


    Emotional factor is limited to buying a expensive toy for your kids or expensive jewelery for your wife. Emotional factor is a excuse, because numbers wont add up.:bab (35):


    Good post! I mean it
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  • Originally Posted by realacres

    Man, you are married yet you find women complex to understand? Then imagine what our situation would be:D.


    Bachelors "think" they can understand what a woman thinks. Married man "knows" he cannot understand what "his" woman thinks!

    P.S. Married man still thinks he can understand "other" women. This is great example of "grass is greener on other side"
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  • A leave and license agreement is not meant to exploit. It has a simple meaning: the licensee (i.e. tenant) has a right to occupy the place for period of license (11 months - upto 60 months).
    After that, he should vacate.
    Each party can give one month notice.

    In tenant - owner agreement, owner has to prove in court that he needs that property for his own stay, otherwise tenant does not have to vacate.

    1. If you are tenant, and you are now shifting to another town, would you like a 3 months notice period or 1 month notice period?
    2. If you are owner, you are giving your 40L worth property to someone for 10k. In the first month only, based on tenant - owner agreement, he decides to grab your property, do you want to take such risk?
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  • Originally Posted by abeerbagul
    P.S. Married man still thinks he can understand "other" women. This is great example of "grass is greener on other side"

    "Other". And look at the society, it has suspicious attitude on innocent bachelors:D.

    Anyways, coming back to the topic I don't think anyone on this forum will stay on rent for more than 2-3 yrs from now. This time is more than sufficient to see & decide about RE purchase as RE will show it's real face in this time. So, you can have agreement of 22 months & relax:).
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  • Just one more thing:-

    Has anyone seen the Movie :-
    Apartment- Rent at your own risk. Maybe abeer has seen this:D.
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  • Originally Posted by realacres

    INSECURITY :- And this is of emotional as well as physical. Physical coz you don't know which type of neighborhood you may land later depending upon the vacancies of flat.

    I am of the firm opinion that housing is a basic need of every animal & humans. Hence, not to buy throughout the life is illogial. What I would like to convey is the fact that buy if you can atleast maintain the same lifestyle if not better if you own a house. Ideally, the price of house which you should buy should be 3 times your annual income, I can make it 3.5 times max to max. So, one is eligible to buy a house of INR 35L if the take home income is INR 10L/annum. Not to forget that you should have atleast 10% the price of house in savings. If this aspect is met & you are not bothered about VFM, go ahead & buy.

    As said before, house is a part of life not entire life. Owning a house is a beautiful experience, but it should not come at the cost of other better things in life. We are not against buying a house, we are against over-leveraging for buying a house .

    Hope this makes the air clear.

    * PS:- If we all would have wanted to stay on rent, why would we have made site visits at first place??

    Man, you are married yet you find women complex to understand? Then imagine what our situation would be:D.


    Well said Real. I think the calculation about 3.5 times the annual salary makes a lot of sense. Ppl should look at that parameter to judge if they are able to afford a house or not.

    About Women, When one is single he does not understand women. Slowly he tries to understand. when one gets married he understands it is very complex to understand. With experience one learns to live with the un-understanding. With more experience one understands it is best not to try to understand. I believe as one nears dying age one loves not to understand.

    VK
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  • Real, I don't think the price of house should be 3.5 times yearly income is helpful in cities, specially something like in Mumbai. I have been looking from 2005-06, and all decent and easily affordable properties were atleast 4-6 times of yearly income. In fact, the one in Thane I could easily afford the EMIs was around 4 times of yearly income, and the best one in thane (2006) in my budget was 6.5 times my yearly income. This is before the insane price rise. Now I can't buy in same building even at 7-8 times of yearly income!

    3.5 times yearly income is too optimistic. Rather than basing this on income, I think rent:price ratio is more accurate to decide the best time to buy.

    I understand your point is not for timing the market but is rather for not overleveraging oneself. But 3.5 x present yearly income will just give you below expectations flat, as experienced even in calm markets.
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  • Originally Posted by ani_meher
    Real, I don't think the price of house should be 3.5 times yearly income is helpful in cities, specially something like in Mumbai. I have been looking from 2005-06, and all decent and easily affordable properties were atleast 4-6 times of yearly income. In fact, the best one in thane (2006) in my budget was 6.5 times my yearly income. This is before the insane price rise. Now I can't buy in same building even at 7-8 times of yearly income!

    3.5 times yearly income is too optimistic. Rather than basing this on income, I think rent:price ratio is more accurate to decide the best time to buy.

    I understand your point is not for timing the market but is rather for not overleveraging oneself. But 3.5 x present yearly income will just give you below expectations flat, as experienced even in calm markets.


    I don't want to Answer for Real here.
    But in my opinion, the post does not talk about what are right prices for apartments. It just talks about what one should strive for?

    If the prices of apartments are more than that 3-3.5-4 multiplier.. it simply means one cannot afford it without cutting down on the way one lives.

    So one can still go and buy 6-7 times multiplier if one wishes but the compromise and sacrifices would mean that you bought something that you could not afford.

    VK
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  • Originally Posted by realacres
    "Other". And look at the society, it has suspicious attitude on innocent bachelors:D.


    Its because, married men have ready only access to "other", innocent bachelors have read and write access.:D:D
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  • Good to see that discussion is going in right direction now. Thanks realacres & RAJESHP. I agree with your views.
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  • Originally Posted by veeemkay
    About Women, When one is single he does not understand women. Slowly he tries to understand. when one gets married he understands it is very complex to understand. With experience one learns to live with the un-understanding. With more experience one understands it is best not to try to understand. I believe as one nears dying age one loves not to understand.

    VK

    Man, so you got hitched without deeper understanding? It is like giving money to the builder without signing an agreement:D.

    Originally Posted by ani_meher
    Real, I don't think the price of house should be 3.5 times yearly income is helpful in cities, specially something like in Mumbai. I have been looking from 2005-06, and all decent and easily affordable properties were atleast 4-6 times of yearly income. In fact, the one in Thane I could easily afford the EMIs was around 4 times of yearly income, and the best one in thane (2006) in my budget was 6.5 times my yearly income. This is before the insane price rise. Now I can't buy in same building even at 7-8 times of yearly income!

    Ani, infact in such cases, I would stick to not 3.5 but 3 times coz the cost of living is also high in metros, be it the food, the travel, hotel etc. When the cost of living is high, the savings are less. My focus is not completely on cost of living but amount of investments & savings as well. You have to set aside some %age income for savings. If you spend more on EMIs, you save less & end up being poorer 8-10 years down the line.

    I think rent:price ratio is more accurate to decide the best time to buy.

    Correct, but here only the cons of renting is primarily discussed with no weightage given to VFM:o. If you talk about VFM, then in current markets, renting wins hands down against purchase.

    I understand your point is not for timing the market but is rather for not overleveraging oneself. But 3.5 x present yearly income will just give you below expectations flat, as experienced even in calm markets.

    What is afordable to you may not be to others, while what is affordable to others may not be for you. Hence, affordability is a relative term. If the avg per capita income is high & one falls at bottom of the pyramid, s/he won't be able to afford a house in that area at that time. A person who can buy a penthouse at Mumbai may not be able to afford even a 1BR flat at Monte Carlo.

    So, don't compare yourself with others, look at what levels you are comfortable at. This will lead a happy life for you:).
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  • Originally Posted by realacres
    "Other". And look at the society, it has suspicious attitude on innocent bachelors:D.

    Anyways, coming back to the topic I don't think anyone on this forum will stay on rent for more than 2-3 yrs from now. This time is more than sufficient to see & decide about RE purchase as RE will show it's real face in this time. So, you can have agreement of 22 months & relax:).

    Already 2 years have passed since this post of June 2010. So what is the real face of RE ?
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  • Good question

    I dont think it has changed in a direction which we all are eagerly waiting
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  • Originally Posted by veeemkay
    Indirectly we are talking about the views (emotional points) that the builders use to exploit buyers and increase prices. :bab (59):

    The points that you mention are indeed important and are the reasons why so many of us want to buy our own homes.

    If I understand correctly, most of the guys who say "Rent Rent" also want to buy homes and that is because of the above points. The difference is that they want to buy "VALUE for money Homes". Value for money for different people can be different.

    VK

    whats wrong with "VALUE for money Homes" ? Its our right to buy value things for the hard earn money...
    we can also say that "buyers get lured and manipulated at builders, banks, interest rates mercy for 20 years" and try to prove how ownership is always right
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