icecube wrote:KulaRaha wrote:I took a mortgage to buy my own home just before PEV in 2007, October. I managed to get a fixed rate for the period...the repayment has not changed.
Currently, the property is up 260% in value. When I first started paying the instalments, my best friend who lived down the road was paying rent at 70% of my repayment. As at 2012, his rent went higher than my repayment by 20%. Now I dont even ask how much more he is paying...rents in my area have escalated to astronomical levels. He has a flat, I have a townhouse with 2 gardens.
What extra funds I manage every year, I pay up part of the principal, and use the rest to buy other assets if possible. My mortgage will end October 2016.
I could not have built my own place as I could not have afforded land where I live. Min is 3 acres, gated communities. I think I made a good decision. At least, better than my friend.
I like this. This sounds like a very wise decision. I think the beauty with a mortgage is that it makes you own a house in a place you may not afford to buy a plot and build in.
what did you mean when you said "he has a flat above?"
Taking a Mortgage is NOT the worst decision Ever.
one of the reason we work so hard is to provide SHELTER to our loved ones. House prices in and around Nairobi have really escalated.the demand is strong and considering the demographics, will stay that way for years to come. a big majority of people with mortgages as opposed to those who construct their own, want to sell their homes at some point in the future.
Its ok to compare real estate Vs stock market returns, but plain wrong to make a decision as to which one is better!