mGa KuRo-KuRo Ni Ka UrO

Thursday, March 10, 2005

Economics of Renting vs Owning a House

Mga tanong sa akin ng isang kaibigan papunta rito sa NZ.
Ka Uro, mag-kano ba ang rental ng apartment o bahay diyan sa New Zealand?
Kung gusto naming bumili ng bahay, madali ba? Mga magkano naman?


Eto ang sagot ko.
Ang mga pinauupahan dito tawag nila flat o unit. Sa isang compound, usually 2 hanggang 4 na flats na magkakadikit. Sa pamilyang nag-uumpisa pa lang okay na ang 2 bedroom flat. May isang toilet and shower, kitchen, living and dining areas. At may isang carport o garahe. Normally, single level lang, hindi up and down.

Meron ding mga townhouse apartments, kadalasan ay up and down. Mga bago, pero, hindi ko ma-rerecomenda dahil may kamahalan and renta.

Ang renta sa 2 bedroom flat o house nasa $180 hanggang $280 per week (note: weekly ang bayaran dito, hindi monthly) depende sa laki, kondisyon nito at sa location. Kapag malapit sa city, sa mga eskwelahan, nasa ruta ng bus, at magandang area mas mahal. Ang disadvantage ng nag-rerent, parang tinatapon mo lang ang pera.

Kung meron ka naman pang down payment, mas maigi kung bumili ka na ng bahay o kahit unit o flat lang. Ang down payment na hinihingi ng bangko ay 5% lang naman. Ang 95% pahihiram sa yo ng bangko. Hindi mo kailangan ng collateral, basta may stable job ka. Mas madali kang makautang sa bangko kung salaried worker ka kasi alam nila kaagad ang total salary mo, kumpara sa kung ikaw ay contractual o kaya may sariling business. Kung sarili mo kasi ang business, hindi mako-compute ng bangko ang kita mo. Normally 20 to 25 years ang term at sa kasalukuyan 7.7% ang interest rate. Mas malaki ang weekly outflow mo sa pagbabayad ng mortgage kumpara sa kung nag-rerent ka lang. Pero, magiging iyo naman ang bahay, eventually.

Kabibili ko nga lang ng isang rental property, isang 2 bedroom na bahay at ngayon ay pina-uupahan ko sa halagang $270 kada linggo. Nabili ko ito ng $210,000. Tingnan natin kung ano ang mas maganda. Ang mag-rent o ang bumili. Sino ang may mas magandang katayuan, after, say 20 years (term ng home loan). Halimbawa, gusto mong mag-retire sa Pinas after 20 years, magkanong pera ang maiuuwi mo?

Total amount paid if renting for 20 years: $270 x 52 weeks x 20 years = $280,800

Medyo komplikado ang formula, pero kung marunong ka ng Excel, pwede mong gamitin ang PMT function at ipasok ito. Interest Rate = 7.7% divided by 52 (para weekly) . Present value = $210000, Number of payments = 20 years x 52 weeks. Ang makukuha mong sagot ay $395.94 per week.

Total amount of amortizations for 20 years: $395.94 x 52 weeks x 20 years = $411,777

Mas malaking pera ang ilalabas mo kung binili mo ang property kesa kung nag-rent ka lang. Mas malaki ng $130,977 ($411,777 minus $280,800).

Para mas madali ang pag-kumpara ng renting versus owning, isipin mo na lang na naglalabas ka ng $395.94 kada linggo. Kung nag-rerent ka ng $270 per week, ang $395.94 minus $270 ay $125.94. Eto ang savings mo kada linggo. Multiply mo ng 52 weeks at 20 years, you get $130,977 after 20 years. May pera ka, pero wala ka pa ring bahay. Yan ang take home money mo sa Pinas after 20 years. At kahit lagyan mo pa ng interest ito, hindi ito aabot ng 200k.

Eto naman kung binili mo ang bahay. Nagbabayad ka ng $395.94 kada linggo. Wala kang savings per week. After 20 years, wala ka ngang pera, PERO, may bahay ka. Magkakaroon ka lang ng pera kung ibebenta mo ang bahay. Ang halaga ng bahay after 20 years, hindi lang magiging doble, kung minsan triple o higit pa. Sa doble na lang: 2 x $210,000, e di $420,000 ang pera mo, at taymis 40 na lang = P16.8 MILLION PESOSES ang iuuwi mo sa Pinas!

Conclusion: You'll be better off buying a house than renting in the long term.

BTW, simplified lang na explanation ito. May mga variables na hindi ko na binanggit. Tulad ng rent, tumataas yan, interest rates, pabago-bago yan. Mga insurances, amilyar at repair expenses, karagdagan yan kung sarili mo ang bahay. Pero pwede na ring i itcha pwera ang mga yan. Manageable na man at di malaki. Just think of owning a house as forced savings for your retirement.

10 Comments:

  • Eto nga rin ang pinag-uusapan namin ni Raquel kaso syempre dapat mag-ipon muna. Also, we have to decide once and for all if we're going to stay in Australia or move somewhere else like Canada or New Zealand. We'll probably stay though. Pero babalik ulit yan sa dapat makapag-ipon muna para sa pangdownpayment.

    By Blogger Geejay, at 10:59 PM, March 10, 2005  

  • GeeJay, the decision whether you'll stay there or not should not affect your decision for buying a house. Madali naman magbenta. About the DP, there are some real estate brokers that facilitate financing without a DP. Mag-inquire kayo. Remember, it doesn't have to be your dream house yet. After about 5 years, sell it then buy your dream house. Sayang ang binabayad ninyo sa rent. Buti nga dyan may govt subsidy for first home buyers.

    When we moved here in 96, we bought a small 2 BR house for 156k in a not so good area. 7 years later, we sold that for 247k and bought a 3 BR house for 239k in a nice area. So if you think about it, parang binili lang namin itong bahay namin ngayon for 156k, di ba? Ngayon, aside from this house, we have 2 more rental properties. This won't have been possible, kung if we didn't decide to buy our first house.

    Siguro iisipin mo malaki sweldo namin. No. Not at all. Our combined income is less than 100k annually. My wife works parttime in the supermarket, sa checkout. And we're even sending our daughter to a private school spending 15k a year.

    Think about it. Sayang ang oras. When is the best time to buy a house? There is no best time. Now is the best time.

    By Blogger Ka Uro, at 8:42 AM, March 11, 2005  

  • GeeJay, republiched all pages. hope you can post comments now.

    By Blogger Ka Uro, at 7:53 PM, March 12, 2005  

  • Ayan. Pwede na. :) Unfortunately, I already forgot what I was supposed to ask as a follow-up question. Ah well. I can just always post later through the shoutbox. :D

    By Blogger Geejay, at 8:40 PM, March 12, 2005  

  • The more I read your blogs, the more na napapaisip akong lumipat ng new zealand. by the way My family and I are based in singapore.

    Pwede mo ba ko bigyan ng idea kung magkano ang kinikita ng techinician dya compared to engineers? At magkano naman ang total expenses nyo every week? gusto ko kasi malaman kung magkano ang dapat income ng isang family para mabuhay ng simple pero comfortable.

    thanks

    By Blogger Charmed, at 2:45 PM, August 12, 2005  

  • charmed,

    there is a thread in pinoymigrants.com tungkol sa living expenses sa nz.
    http://www.pinoyimmigrants.neodelphi.net/forum/viewtopic.php?t=24

    i'ld say technicians will be earning from $35,000 to $60,000 per annum. i assume this is in the IT or electronics field.

    mahirap mag-compare based on income only. there are countries na malaki nga ang income mo pero mataas din ang expenses. quality of life and lifestyle can also be different. it depends on the person kung anong klaseng lifestyle ang hanap niya. for example, some like the hustle and bustle of NYC or London or Sydney. Me, I prefer the slow-paced, laid back lifestyle here in Auckland.

    By Blogger Ka Uro, at 3:05 PM, August 12, 2005  

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    By Anonymous Anonymous, at 10:38 PM, July 25, 2006  

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    By Blogger jato, at 3:56 AM, August 13, 2008  

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