ฝัง
- เผยแพร่เมื่อ 6 ส.ค. 2024
- When buying a property, should YOU make a downpayment or not? 🤔
In this real estate video, we're diving deep into a question posed by one of our viewers. He asked whether it's better to buy a small investment property and pay it off quickly or go big and leverage more. It's an excellent question and a crucial decision. We're here to explore both options, dissect the numbers, and help you find the best path for your personal investment strategy.
We compare two real estate investment approaches:
👉 David the Downpayer: David opts for a safer, low-leverage approach. He makes a substantial down payment and minimizes his mortgage.
👉 Larry the Leverager: Larry chooses a high-leverage approach. He doesn't make a down payment and finances his properties with mortgages.
The Numbers Breakdown:
We dissect the numbers, including purchase costs, monthly mortgage payments, pre-tax cash flow, and the significant tax benefits.
Analyzing the Pros and Cons:
We break down the pros and cons of each approach and the risk-reward trade-off.
Your Turn:
What's your take on this property investment dilemma? Is it better to be a David or a Larry? Share your thoughts in the comments.
In the world of real estate investing, there's no one-size-fits-all answer. It's about what works best for your investment goals and risk tolerance. Your input can spark insightful discussions in our community.
Best flexible savings account:
perfinex.de/calculator/best-s...
Best fixed-term savings account:
perfinex.de/calculator/best-f...
Read the full article on our website:
perfinex.de/property-buying-d...
-
Video Axel mentioned: • Why Properties With No...
-
00:00 Should YOU Buy A Small Or A Big Property?
00:45 David (The Downpayer) Investing In Real Estate
05:20 Larry (The Leverager) Investing In Real Estate
07:16 Pros & Cons Of Both Real Estate Investing Options
-
PerFinEx GmbH - Personal Finance for Expats
The #1 English-Speaking & Independent Financial Planner in Germany
perfinex.de/
-
Set Yourself up for Financial Success!
Text Us on WhatsApp: +49 175 50 30 773
Secure a Free Meeting with Us: perfinex.de/meeting/
-
Follow Us on Social Media & Join the Community!
Facebook: / perfinexgermany
Instagram: / perfinexgermany
LinkedIn: / perfinexgermany
TikTok: / perfinex
-
* This is an affiliate link from which we will earn an affiliate commission or referral bonus (depending on the company). By clicking the link, you support our project at no additional costs for you. We thank you very much for your support. As of the date of posting this video, the content is accurate. Some offers may be no longer available.
-
The content of this TH-cam channel is provided for informational, educational, and entertainment purposes only and is not intended to constitute accounting, financial, legal, and/or tax advice. None of the information presented is intended to form the basis for any personal financial decision. Consult a professional financial advisor or conduct your own due diligence. PerFinEx GmbH makes no representation, warranty, or guarantee about the accuracy of the information contained in this TH-cam channel or in links to other TH-cam channels or websites. Publication or reproduction of any content of this TH-cam channel is strictly prohibited and punishable by law. By viewing, you acknowledge to have read this agreement, understand it, and agree to be bound by it. If you disagree in any way, you are not permitted to view our content. Neither PerFinEx GmbH nor anyone acting on their behalf will be liable under any circumstances. The exclusive place of jurisdiction is irrevocably Munich. Further mandatory & legal information is available at perfinex.de/impressum
© PerFinEx GmbH. PerFinEx is a protected trademark in the register of German DPMA. All rights reserved. Any liability excluded.
Free meeting with us: perfinex.de/meeting
Good explanation Axel!
Hi Axel, I think you did not mention anything about the fix interest period and your opinion. What makes sense from your point these days fixing 5 or 10 years?
We look at each case individually when financing for clients. Most people go between 10-15 years depending on the personal goals and exact conditions offered by the bank.
And if we assume a property price increase Larry is even better off. Would it be fair to assume that banks are willing to give a loan without any downpayment?
With a good property and a good financial situation it is possible to get a 100% mortgage from banks, so you only have to pay the closing costs yourself.
You seem to be saying that the tax deductable costs can be deducted from the total income, including income from employment. I thought that these costs can only be deducted from income generated from the rental property.
Could you please confirm which is correct?
Income from employment and income from real estate fall into the same category when filing your taxes, therefore you can offset your real estate losses with employment income. That’s one of the reasons why real estate is such a great investment! -Axel
Even if Larry interest rate is twice than David, when purchasing for investment to give as rent and you are high earner, then Larry case is better off.
If Larry is willing to take the increased risk from leveraging, you are 100% correct.