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Buying instead of renting: 7 good reasons for residential property


2/5/2016
Buying instead of renting: 7 good reasons for residential property
 

The topic of "buying instead of renting" has often been covered in magazines, TV shows, newspaper articles and lots of other media, usually based on special market conditions or using individual examples. But what does it really depend on, what are the fundamental arguments for buying residential property, regardless of the current interest rates or market trends?

Here's a clear example: Owning your own property is not a really a suitable choice for those who don't really care about assets, who prefer to live a fully unfettered life or simply don't want to feel "strapped down". For everyone else, however, there are good reasons to look into this option more closely.

Residential property in Germany is, as a rule, the most important component for accumulating private wealth. These seven reasons explain why purchasing real estate is worthwhile:

1. You don't pay rent to other investors; rather, you build your own equity month by month.

2. Owning your own property gives you a lot of independence and no landlord can threaten to throw you out. You also won't face any unpredictable rent increases.

3. Real estate represents a solid material asset whose value appreciation is relatively immune to economic fluctuations.

4. As a gainfully employed person, you can plan without risk because you know the exact amount of financing you generally need to purchase the property.

5. You gain more personal design freedom and don't have to consider your landlord's restrictions.

6. You get greater security in your older age. Pensioners who live in their own (already paid for) home can use their monthly income for other things.

7. Property owners are happier people.

The findings of a June 2015 study by the University of Hohenheim on the question of "Does residential property make you happy?" were very clear. It surveyed 2,788 people in Baden-Württemberg and 1,442 people in the rest of Germany. What it found was that around two thirds of residential property owners indicated that they were more satisfied with their lives by owning property.

One of the reasons for this feeling of happiness was the fact that owning your own property is a multigenerational topic. Clearly, this emotional added value is another good reason.

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