Why rent where you live?
On this week’s episode of Q&A Sunday, Samuel got proposed a common question – why rent where you live? It’s a frequently asked one because it’s become a fashionable thing to say among property people. The questioner asked why is it better to rent where you live if the cost is the same as a mortgage. He mentions the flexibility that can occur when owning a property, such as the options to rent rooms out, switching it to a buy-to-let and more.
It was well-worded but there is an irony that isn’t lost on us here. The entire premise behind ‘rent where you live’ is because it opens your capital up for investment rather than tying it down. The questioner is saying he would buy a property to use it to generate cash flow. Essentially, we’re making the same points. Property should be used to increase your income.
In other words, if you’ve done the numbers and figured out a way to buy the place, live there and let it out – excellent. The general ‘rent where you live’ mantra is more aimed at folks who think it’s a good idea to splurge out on cars and houses. Instead, they should be using their cash flow from their investments to rent their lifestyle items.
Overthinking an entry into the property market
Another question from this week’s episode was about time. How long must you wait before stepping into the property arena? Some people reading this will be tirelessly researching, learning and planning without taking action. Of course those things are important but they can happen at the same time as getting involved. You can’t have a 10 year plan, instead go for a 1-month plan and execute it. Overthinking and procrastinating will be the death of your dreams.