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In Denmark where I live you can loan 1 million Danish kroner at around 5k each month. A decent downtown apartment in a bigger city or a house in the suburbs is
by jaabe 7y ago
In Denmark where I live you can loan 1 million Danish kroner at around 5k each month. A decent downtown apartment in a bigger city or a house in the suburbs is 2-4 million. Renting the equivalent is 10-15k, and with renting you obviously skip a lot of the maintenance cost and taxes. On the flip side loans are tax-deductible, meaning you actually don’t pay 20k to borrow 4 million, you pay 12k.
It can still be cheaper to rent, at least if you look at the small scale. Because in 30 years, those 4 million will be yours while people who rent will still have nothing. It’s also risky, because maybe those 4 million will really be 1 million.
Over all, owning real estate in a safe location is always going to be much better than renting. At least in Denmark. Hell, if you can manage to buy around 15-30 lower-cost apartments in a university city and rent them out, you’ll be able to pay your loans and have enough spare in passive income that you never have to work again.
- Bombthecat 7y agoI doubt that the house would be 4 million. Thanks to reducing population, increased building and housing. Plus who knows how the weather will be, I'm not sure that owning a house is the right thing in 20 years.
- scirocco 7y ago"Buy land, they're not making it anymore" - Mark Twain
- mapleoin 7y agoThe problem is we've started deleting it now. https://en.wikipedia.org/wiki/Sea_level_rise https://en.wikipedia.org/wiki/Sea_level_rise
- Aeolun 7y agoThis is perfect. It’ll make my land worth that much more! Just have to be careful to only buy land 2.4m above sea level.
- chrisco255 7y agoYeah hope you plan to hold for 100 years.
- openoi 7y agoHumans build houses with their children and grandchildren in mind. Holding to land for 100 years and longer is not that an uncommon thing.
- HeyLaughingBoy 7y agoNot in the US!
- jpindar 7y agoIf you choose the right spot, it'll become oceanfront property!
- ahje 7y agoWhen I lived on Amager about six years ago, the prices were definitely around the 3-4 million mark in the suburbs. Prices fell somewhat once you got out of Copenhagen, but it was still ludicrously expensive. Are you saying the prices droppped sharply the last 5-6 years?
- jaabe 7y agoNo. But I probably should have been more clear. I mean, first of all, there are more cities than Copenhagen. I have a 3 room 92m^2 apartment that is 15 minute walking distance from Aarhus H that cost us 2.2 million. Secondly, I’d personally call a place like Valby “downtown” Copenhagen even though it would probably be more correct to label it surburbia like you do.
- ahje 7y agoI wouldn't call Valby suburbia, although it'd definitely a suburb. The real Copenhagen suburbian hell start out at Kastrup, Glostrup, Ballerup, Lyngby and thereabouts. Of course, there are other Danish cities than Copenhagen, and prices do vary. The parent comment I replied to simply stated that there are no 4M DKK houses, which simply isn't true.
- oblio 7y agoDenmark's population went up by more than 15% in the past 30 years, FYI :)
- roland35 7y agoThat is interesting loans are tax deductible in Denmark, I always thought that was just a US thing! From my understanding of the new federal tax law though, the higher standard deduction makes the mortgage tax credit less feasible for most people.