Parent's house.
Ask HN: Where can I live off 1k USD per month?
411–420 of 557 posts
Re: Ask HN: Where can I live off 1k USD per month?
#412Earlier quoted context omitted.
In a way yes. But its also using leverage to amplify your gains. Say I get $90,000 to go buy a house, I spend the $90,000 and have 1 door. I get a tenant in it and they make a $90,000 down payment. I then go buy another house and get another tenant in it and they make a $90,000 down payment. I now have two houses and still have the same amount of money I started with, I can continue this cycle and as long as property…
> Say I get $90,000 to go buy a house, I spend the $90,000 and have 1 door. I get a tenant in it and they make a $90,000 down payment. Why wouldn't the tenant spend $90,000 on the house themselves, cutting out the middleman?
Korea has a housing lottery where they give you first dibs on a new apartment at an extremely discounted price with financial assistance. Due to demand, this housing is difficult to get even at full price. However this lottery is only available to first-time homeowners. So my friend chose to do cheonsae instead of outright buying a place to save his housing lottery ticket.
Usually cheonsae deposit is less than 100% of the purchase price, so it costs less. Even if the difference is small (10%), you are guarded from drops in real estate value. If you put down $90,000 deposit you should get back exactly $90,000 even if the property value dropped below that.
And perhaps cheonsae loans are easier to get than house mortgages. I'm not sure about this, but the deposit may be better collateral than the property?
Re: Ask HN: Where can I live off 1k USD per month?
#413Earlier quoted context omitted.
Risk… you are exposed to the risk of decreasing property values if you buy.
But as a renter, you are exposed to the risk that your landlord won't have your deposit when you are ready to move out. To me, that seems like a bigger risk.
You know they at least own the house that costs more than what they owe you, so in a court you can probably regain your money
Re: Ask HN: Where can I live off 1k USD per month?
#414I live in Jakarta, Indonesia. My monthly living expenses (adjusted from IDR to USD on current rate)
1. Apartment rent, 6 months contract at $1300 + $200 deposit, pay upfront, thus $250 monthly. It is a small apartment 1 common area, 2 tiny bedroom, and tiny balcony
2. Utilities, varying from $30 to $50, mine has 2 AC running almost 24/7, a PC with average 200 to 300 watt power draw, and 5 led light bulbs
3. Meals, 3 times a day for 1 person, $20 daily or $600 monthly (this amount considered fancy meal, you can get way cheaper meals like $2/each, way cheaper if you cook)
4. Internet, up to 100 mbps, $35 monthly. Internet quality like speed and stability will depend on area
5. Phone data, $7 monthly
6. Cigarette, I'm a heavy smoker (almost 2 packs a day), $4 daily thus $120 monthly
In total: ~$1050 I don't count for entertainment, transportation (people mostly use Gojek or Grab), subscription
Experience living in Jakarta from native perspective.
- Language barrier, most people can talk in English, although not that fluent, hand gestures give you more power than talk
- Poor pedestrian side road, if you like to walk
- City full of concretes, green park almost non existent
- Bad air quality
- Noisy if your resident near big road or high way
- Covid-19 related situation, Jakarta not the worse but people here tend to not care about this
Alternative to Jakarta, I would recommend.
- Bandung, cheaper living cost, small city, good air quality on most part, had lived there for 2 years
- Bali, foreigner friendly, especially Ubud area for extra nature scenery, I don't recommend Denpasar
Let me know if you have any question (email on my profile), as a fellow game dev I admire your dedication
Re: Ask HN: Where can I live off 1k USD per month?
#415I live in Korea. Some months my total expenses are as low as $400 while living comfortably. If I spent $1000 in a month, I spent a lot of money. I'd say my average monthly living expenses are $600-$800. My main expenses are food/entertainment, and I eat out a lot (50% of meals). Housing is probably the biggest living expense. I take advantage of Korea's interesting rental system called Cheonsae: Basically, if you put…
edit: the break-even point is 6% APY
$10,000 deposit used to be converted to $100 rent (to get 12%). It's now only $50 rent. (Although in my case I think it still was $100/12%).
Re: Ask HN: Where can I live off 1k USD per month?
#416Earlier quoted context omitted.
Basically, nobody wants to admit that their own country's long established and respected systems are ponzi schemes. Many South Korean landlords are underwater on a bad investment and use the next renter's deposit to pay out the last. Citation not possible. The point of the system was to spur investment in the south korean economy.
next question: how would one go about betting on Korean residential mortgage credit spreads as an American retail investor?
Thats not the good bet - based solely on this information - the landlords would be fine on their own property, they would have lost a portion or all of a prior renters deposit in some other speculate bet instead of just letting it sit in a bank account, new renters deposits are paying for the ability of the landlord to pay the prior renters
Of course that prior speculative bet could be in mortgage(s). You would need to look at other weakness in that economy to rationalize whatever bet you want.
Re: Ask HN: Where can I live off 1k USD per month?
#417Earlier quoted context omitted.
12% is pretty high yield for the modern/western world. South Korea central rate is %0.75 according to Google. Where does the 11.25% come from?
That is exactly my point. There is an opportunity cost in keeping a large deposit (lost interest/investment opportunities). However that opportunity earn a certain APY in order to be a better "investment" than the housing deposit (a penny saved is a penny earned): - $10,000 additional deposit reduces monthly rent by $50. - 50 * 12 = 600 - 600/10,000 = 6% The monthly rent reduction used to be $100 per $10,000. So it u…
What do you additionally save by not paying taxes on the income that you would have used to pay rent?
Re: Ask HN: Where can I live off 1k USD per month?
#418Lots of places in Pakistan and India you can do that on $1000 USD a month. If you don't do really well with hot weather you could pick a traditional hill station location (Murree, Darjeeling, Shimla, etc). They have lots of domestic tourism accommodation, I'm sure it wouldn't be impossible to negotiate month-to-month terms with some of the property owners there.
Why would anyone in their right mind go to Pakistan? Straight up dangerous for women, most places are dangerous for men as well. Sure they have nice mountains, but you have those in much safer places as well. When someone recommends Pakistan I feel like they’re saying: “Sure, Hell is a bit hot but it has great view”.
Stop watching CNN too much :)
Pakistan is perfectly safe option and is a fast-growing economy with a significant IT industry.
Re: Ask HN: Where can I live off 1k USD per month?
#419Uruguay
Re: Ask HN: Where can I live off 1k USD per month?
#420Earlier quoted context omitted.
That is exactly my point. There is an opportunity cost in keeping a large deposit (lost interest/investment opportunities). However that opportunity earn a certain APY in order to be a better "investment" than the housing deposit (a penny saved is a penny earned): - $10,000 additional deposit reduces monthly rent by $50. - 50 * 12 = 600 - 600/10,000 = 6% The monthly rent reduction used to be $100 per $10,000. So it u…
What do you additionally save by not paying taxes on the income that you would have used to pay rent?
True~ the "pennies saved" are earned, but not taxed.
I did not consider that!