Land / house prices

Well explained. The 10k PHP is just for owning it. You can probably double that to include for maintenance, repairs, revovations after 25 (small) and 50 years (big) and much more in the calculation. If it is a house and lot the calculation will be somewhat lower because the house is only a part of the price. Another question is if a condo is easier to maintain? But what is after 50 or 99 years? Is the owning of a condo really be an owning and not something similar of an use right?

The inflation and the degradation will lower the value of a house or condo. But the real estate market can quite easy offset that as long the bubble does not burst and the property is well maintained. Many real estate objects on this planet are already priced far above the real value. The bubble is still growing and I fear the burst will come in conjunction with a currency mess.

 

That's what I said if you care to read the Post again

 

But that bit of cheating is not well-known. The fellow and his aunt are filipino. I imagine purchasing a unit, "cozy" to begin with, in advance of occupancy. And excitedly ordering furniture to fit, accounting for every inch of space. Only to discover... (One good thing about the Philippines, you can order furniture, made to order, as cheap or cheaper than store-bought. My house is full of it.)

 

Don't actually agree with that - based on personal experience (plus of many other people I know) and whether rented or purchased, the property is still a "place to live". This would be affected by the particular country's housing market but I paid x for a house and sold it 20 years later for 5x - in that time I would have paid about 2x in rent. The interest from the x if not used to buy the house would have been a total of about x over those 20 years - so at the end of 20 years of renting I would have had a net zero in cash (my original x plus the x obtained in interest minus the 2x rental, even less in fact as my capital would have been eroded to pay the rental each month) - but by owning I had a net 4x (the sale for 5x minus the x original cost). Obviously the next house costs more than the original one bought 20 years before but a person in retirement could take that 4x profit and rent if he wished, having spare cash to spend on essentials (create your own list). There are maintenance costs of owning but in my case the x represents the purchasing cost plus updating the property to modern standards at the time - the maintenance cost was minimal over the 20 years. I also bought another house for x and sold it for 2x three years later.

There is no doubt that buying can produce a very high profit if bought at the correct time and renting can be a loss. To put that in Philippine terms is difficult as many say prices there are already excessive - however, many markets go from excessive to hyper-excessive before they eventually fall (and even then they recover to hyper-excessive and beyond eventually).

But, as stated in my earlier post, luck is a big factor - Japan suffered a huge decrease in property values a very long time ago and not all sectors and areas have recovered.