Mortgage versus rent: when is it more profitable to buy than rent

2024 Author: Malcolm Clapton | [email protected]. Last modified: 2023-12-17 03:44

You can save up for a "odnushka" in the suburbs for 35 years. And you will pay off the mortgage for just 10. Together with Avito, we explain why a mortgage is still better than a long-term lease.

1. You live in the "right" city

Domofond.ru experts: according to the indicators of 2018, with an increase in rental prices by 3% per year, and real estate prices - by 6%, in a number of cities mortgages will not only save money, but also buy your own home many times faster.

The calculation was carried out for a family of two working people. It was assumed that everyone has an average salary in the region (according to Rosstat), and the family is ready to spend half of the total income on housing. At the same time, we already have 20% of the average cost of a one-room apartment in the city of residence on hand, and this money can also be put in a bank and start saving.

The top five cities with favorable mortgages are Khimki, Moscow, Makhachkala, St. Petersburg and Balashikha. Here you will pay off a loan for an average "odnushka" at a rate of 9.55% with an initial payment of 20% faster than if you put this money on a deposit and saved up while renting a house.

There are cities in which it is impossible to save up for your own apartment with an average salary. These are Sevastopol, Simferopol and Sochi. And it is quite possible to pay off the mortgage: in Sevastopol it will take 17 years and 2 months, in Sochi - more than 14 years, and in Simferopol - about 12.

The map shows the spread of the cost of apartments in different regions. Offers can be filtered by price. For example, an apartment by the sea in Sevastopol has more than 400 variants of only "odnushki" costing 2, 5-3, 5 million rubles. Having applied the filter "Object type", you can see that the secondary housing is more expensive.

2. Your income grows slower than inflation

It so happens that a person does not want to change anything in life and has been working for years at the same enterprise, embarrassed to ask for a raise. It is quite logical that in such a situation the salary will not grow.

And inflation, unfortunately, cannot be stopped. Over the past five years, it has exceeded 40%. In 2018, due to inflation, the real value of the savings of Russians by 3, 9%, since the beginning of 2019 - by 1, 6%.

If your income is not growing, mortgages are beneficial. You conclude an agreement with a fixed monthly payment - and as you paid half of your salary, you will pay throughout the entire period. And even if your income doesn't grow, you still won't be left on the street.

3. You don't know how to save at all

One guy started saving up for a Ferrari, but then he could not resist and bought a shawarma. It's the same with savings for an apartment. And the larger the amount, the more tempting to spend it - buy a fresh smartphone, upgrade your car, go on vacation to the ends of the world.

Lack of long-term goals hinders saving. Only 34% of Russians are watching Russians do not know how to save money and often take loans for expenses and systematically save for something - most often on vacation or "for a rainy day." A third do not know at all what. At the same time, 30% of residents of cities with a population of one million are now paying off loans.

Mortgages are disciplined. You are not throwing money, you are planning a budget. And you know exactly when it will end. And if incomes rise sharply, it will be possible to pay off the mortgage ahead of schedule. And go on vacation with a new car and a fresh smartphone.

4. You are afraid that money will suddenly become less

It is good if you have entered into an agreement with the homeowners and it indicates what exactly threatens for delay. But it happens that there is either no contract at all, or it was not drawn up in your favor: you did not pay for the next month - look for a new home, the deposit is not refundable.

Banks are more loyal. They have already received part of the amount from you and want you to pay in full. Honestly explaining the situation will help you find a solution. You will probably have to overpay a little, but you will not be kicked out of the apartment.

5. You notice that rent is getting more expensive

The average monthly rental price for a 1-room apartment in Russia for the year is 4.6%. In Moscow, "odnushki" rose in price by 10%, "kopeck piece" - by 12%. There are still options for rental housing in Moscow, costing up to 20 thousand per month, but they can be counted on one hand.

If you really need to live in Moscow, but there is absolutely no money, you can rent a log house for only 12 thousand rubles a month. Nearby will be the Planernaya railway station, Novoskhodnenskoe highway and Leningradka. If you wish, you can walk to Moscow.

Another option is to take on a mortgage a studio with an area of 19 sq. m in Krasnogorsk (15 kilometers from the Moscow Ring Road along the Novorizhskoe highway). A separate apartment in a new cottage will cost 570 thousand rubles. With a down payment of 20% and a rate of 9.55% per annum, you can pay the same 12 thousand rubles and in 3 years 8 months your home will become yours.

The demand for good options is always higher than the supply. Therefore, apartment owners can dictate their terms. There are a lot of arguments. From "we decided it costs more" to "we need more money, and you have it."

The agreement does not protect tenants, although it is said that the terms of the lease agreement (including the price) must remain unchanged throughout the year. It will be more expensive for itself, and to accuse you of damage to property is a piece of cake. Or the owner will wait for the expiration of the contract and offer to conclude a new one, but with different numbers.

In the mortgage agreement, the numbers are final. The monthly payment, like the total amount, cannot grow. And it protects you as a mortgage holder (learn that word!). Moreover, inflation depreciates money. As a result, you will still pay, say, 30 thousand rubles, but it will not be 500 dollars, but 480 or even less.

Let's say you've found a 33 sq. m in Orekhovo-Zuevo. A resale with a nice renovation in 5 minutes from the railway station costs 1.95 million rubles. With a first installment of 20% and a payment of 30 thousand rubles per month, you will pay off the mortgage in 5, 5 years.

6. You want to live in your own apartment

Your apartment is priceless. You don't have to think about hammering in a nail or re-gluing the wallpaper. You do not spend money on inconvenient cheap things that should only serve "for the time being." You can throw away all the trash and have a picnic on the floor in an empty room. Finally, you are free to get a cat, a dog, a guinea pig, a three-meter python - but at least all of them at once!

For those who are going to buy an apartment, there is housing on Avito Real Estate. Experts will find out whether the object is already in a mortgage, whether it has been arrested, how many owners were there, who is registered, whether there are heirs who can claim the living space, whether the apartment is involved in fraudulent schemes.

Attention: mortgage is not suitable for everyone

The pros of mortgages don't work for everyone. You shouldn't even think about a home loan if:

• your income is unstable;
• you are not sure about the partner with whom you want to take out a mortgage;
• you are terrified of collapses, defaults, global crises and a zombie apocalypse.

However, if the apocalypse happens, then you can quickly arrange a mortgage for an underground bunker. Chances are good that you won't have to pay it!

Consolation: renting has its advantages

Although from an economic point of view, mortgages are more expedient than long-term leases and attempts to save up for your own apartment, there are still many reasons to rent a house, rather than buy.

• The landlord always pays for repairs that were required through no fault of yours.
• If it doesn't work out with neighbors, you can always move.
• You can buy cheap furniture and appliances. Why waste money if your next apartment will already have a microwave oven or a comfortable office chair?
• You are more mobile: if you change jobs, you can easily move to a more suitable area.
• If you run out of space, just rent a bigger apartment. The difference in price between "odnushka" and "kopeck piece" is small.
• The monthly mortgage payment is higher than the rental price. This means that you can rent an apartment for the same money closer to the center or in better condition.