Name: Why You Will Regret Buying a House in 2021
Uploaded: 2021-06-16T18:15:07.000Z
Duration: 9 min 23 s
Description: Thousands of YouTube videos with English-Chinese subtitles! Now you can learn to understand native speakers, expand your vocabulary, and improve your pronunciation...

  Mark Twain once said: "Buy land, they're not

The superlative

Real estate is one of the oldest industries in the world.

It's not a coincidence that we have been told that a house is the best investment you can

Of course, in the 21st century, we have far more investing tools than generations before

Derivatives, options, bonds are no longer the instruments that only the rich have access

With a simple investing app on your 200 dollar smartphone, you can start trading stocks.

And besides, best-performing investments are not even coming from the rich but from the

bottom, such as the Cryptocurrencies that are challenging the status quo.

Regardless of all of these investments, real estate still remains the king of investments.

Because unlike anything else, it simple, you can touch it, and easy to understand.

  You don't have to look far for some evidence,

once worlds richest man, bill gates is also pouring millions into real estate,, Bill Gates

now is America's Biggest Owner Of Farmland.

he purchased 242,000 acres of farmland across the U.S. — enough to make him the top private

  But regardless of how great this market is,

it still goes through ups and downs, and if you end up buying a house when the market

is at its peak, you are going to lose because sooner or later, the value of your house will

And there is a huge difference between buying a house and investing in real estate.

They might look as if they are the same thing, but your needs usually do not align with what

is better from an investing point of view.

So as a real estate investor, I want to share with you why millennials should not buy a

house, or at least, if you are buying a house, you have to consider all these factors that

So give this video a thumbs up, and let's jump right into it! 

  A house with an asking price of 3.5 million

dollars was sold for 4.5 million dollars because the seller received 7 offers, and the price

bid kept rising to the point where the house was sold for an extra million dollars.

If you are the seller, that's a good sign.

If you are a buyer, then you might be wondering whether it worth paying an extra million dollars

Even when it comes to houses that cost just a few hundred thousand dollars, people are

overpaying by 30, 40, or even 50 percent just to be the one who is going to buy that house,

and that's normal in a market when there is a shortage of houses.

  This graph explains it all (show it from the

It illustrates the number of Monthly Supply of Houses in the United States.

Starting from 2010, when we got out of the last housing crash, the supply of houses was

at a stable rate, so house prices grew steadily, but there is a clear sign of how the number

of houses in the market dropped significantly in April 2020.

And even though we are almost out of this pandemic and the future seems a little more

predictable Than it was a year ago, the number of houses didn't increase much in the market.

And that's probably because the sellers are looking at how fast home prices are rising

and are like, "why should I sell when I can wait and keep getting wealthier doing nothing

unless I will get an offer that's really good?

That's why in a single year, home prices rose by 17 percent.

In a single year, home prices rose as much as they did in the last ten years.

It's psychologically difficult to convince yourself to sell when everything is rising.

It really doesn't matter if it's a stock, bitcoin, or crypto.

When it's rising, for some reason, you imagine it's going to rise forever, and if it's falling,

you imagine it's going to fall forever; that's why people often quickly sell to minimize

Most people are short-term thinkers and not long-term thinkers.

In these kinds of times, I like to remember what Warren Buffett said once: be "fearful

when others are greedy, and greedy when others are fearful."

I am not saying there is going to be a crash or how much more prices are going to rise.

All I am saying is that just take a look at what's happening in the market.

A good deal is to when the house price is at least slightly lower than markets average

so that you can renovate it, it will rise significantly in value, or you can rent it

out for a much higher price or at least a deal that's not above the markets average,

but that's never going to happen when you are in a bidding war against dozens of other

  Don't get me wrong, owning a house is far

better than paying rent your entire life, especially if you are going to live in the

same area for a long time, even though homeownership comes at a higher price.

It includes renovation and other expenses.

However, you also have to consider the opportunity cost.

This is the cost that people don't count at all when they are thinking of purchasing a

Every penny you use to buy a house is a penny that could be invested elsewhere like the

stock market, bitcoin or anything else, including your own business.

But let's take something more stable like the SP500.

An index fund that invests in the top 500 US companies.

It usually grows by around 10 percent in the long run, but lets be a bit conservative and

When you take a mortgage, it's a 30 year investment, you are going to become a homeowner, but you

have to keep making your monthly mortgage payments.

So let's take a look at what if you invest that money instead and rent a place.

With a 20 percent downpayment and 3 percent mortgage rate, you are going to pay 1017 dollars

That's significantly cheaper than renting since that house would be rented out for at

But if you count property taxes (300 USD), renovation which is another 1 percent of the

total price of your house ( 300 USD), insurance which let's say another 100 dollars, you will

Buying a house still looks like a far better deal.