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Most Germans don’t buy their homes, they rent

qz.com

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Re: Most Germans don’t buy their homes, they rent

#11

Post by thesimon »

buro9 wrote: post #3
DocTomoe wrote: post #2

Being German I want to pPoint out that the article leaves out one cruicial detail: Building your own home puts you into debt for quite literally the rest of your life. We do not like debt.

Yup. Germany has one of the lowest adoption rates of credit products such as the humble credit card out of nearly all Western nations. Debt is not liked. Edit: From the same site, the linked article at the bottom has the answer: http://qz.com/262595/why-germans-pay-cash-for-almost-everyth... A better link: http://www.businessinsider.com/you-have-to-understand-german...

>such as the humble credit card out of nearly all Western nations

Of course using your overdraft is totally fine, but using the evil credit cards even when paying in full is just like declaring bankruptcy. Doesn't help payment services in Germany that Visa/MasterCard is always considered an evil credit card and debit brands aren't too common.

Re: Most Germans don’t buy their homes, they rent

#13

Post by thesimon »

premium-concern wrote: post #6
buro9 wrote: post #3

Earlier quoted context omitted.

Yup. Germany has one of the lowest adoption rates of credit products such as the humble credit card out of nearly all Western nations. Debt is not liked. Edit: From the same site, the linked article at the bottom has the answer: http://qz.com/262595/why-germans-pay-cash-for-almost-everyth... A better link: http://www.businessinsider.com/you-have-to-understand-german...

Yep. "Don't buy things if you can't pay for then." sounds reasonable, but some other countries seem to disagree. Not surprised that those countries suffer from government shutdowns over how much the debt ceiling is raised.

>suffer from government shutdowns over how much the debt ceiling is raised

On the other hand: The government shutdown because of the debt ceiling seems just like "Stop hitting yourself" on the playground.

And Germany's budget is far from balanced.

Re: Most Germans don’t buy their homes, they rent

#14

Post by wil421 »

andreasklinger wrote: post #9
DocTomoe wrote: post #2

Being German I want to pPoint out that the article leaves out one cruicial detail: Building your own home puts you into debt for quite literally the rest of your life. We do not like debt.

+1 To explain cultural difference: - In the US you are considered financially stable if you are always paying your debt/credit on time. - In the germanic countries you are considered financially stable if you have none. My US Bank clerk needed a few meetings to convince me that it is good to build go into monthly credits (creditcard) to support my credit score.

I wouldn't go as far as saying always. The banks want a history of loan payments. I'm 30 and just got my first installment loan for a car.

Getting a home loan is difficult. I don't have any bad credit at all but not much installment loan history.

Re: Most Germans don’t buy their homes, they rent

#15

Post by bryanlarsen »

DocTomoe wrote: post #2

Being German I want to pPoint out that the article leaves out one cruicial detail: Building your own home puts you into debt for quite literally the rest of your life. We do not like debt.

I know some incredibly debt-averse Americans, and they all consider mortgage debt to be "good" debt. They still try to minimize it, and pay it off as quick as they can, but they all would recommend reasonable mortgages.

Re: Most Germans don’t buy their homes, they rent

#17

Post by adrianratnapala »

Can somone explain what the article means by:

> Germany also loosened regulation of rental caps sooner than many other countries,

Does that mean the amount of rent control was deregulated? I thought the rent control here in Germany was pretty strict -- at least in the sense that the landlord can't increase the rent during an existing tenancy.

Re: Most Germans don’t buy their homes, they rent

#18

Post by thatfrenchguy »

buro9 wrote: post #3
DocTomoe wrote: post #2

Being German I want to pPoint out that the article leaves out one cruicial detail: Building your own home puts you into debt for quite literally the rest of your life. We do not like debt.

Yup. Germany has one of the lowest adoption rates of credit products such as the humble credit card out of nearly all Western nations. Debt is not liked. Edit: From the same site, the linked article at the bottom has the answer: http://qz.com/262595/why-germans-pay-cash-for-almost-everyth... A better link: http://www.businessinsider.com/you-have-to-understand-german...

Never seen credit cards outside of the US/UK/Canada...

Re: Most Germans don’t buy their homes, they rent

#19

Post by mto »

DocTomoe wrote: post #2

Being German I want to pPoint out that the article leaves out one cruicial detail: Building your own home puts you into debt for quite literally the rest of your life. We do not like debt.

Same for Austria. Then considering that you might change jobs every few years... and the jobs are mostly in the cities, where you can't afford building a house.

We live in a small to medium size flat for 380€/month, including some running costs. Buying it would cost roughly 250k. That just doesn't pay off. Most medium sized houses are about 700k€ in the region, with typical software developer wages at 2-4k€/month before taxes. So 1.5-2.5k€ after taxes. Now go figure how long you will be in debt...

And of course, people are older nowadays when they start to earn. For example, my parents started working with 16. I visited a technical school up to age 19, had to do a year of civil/military service, then worked 2 years to save some money, then did a CS bachelor. A bachelor alone is "no real degree" here, so also doing an MSc. Working while studying to afford the studying prolonged the studies a bit.. and in the end I started with my first real OKish earnings at age 28 when I started with my PhD. So... yeah. At the bank they laughed at my income when asking for a loan for a flat.

Re: Most Germans don’t buy their homes, they rent

#20

Post by buro9 »

thesimon wrote: post #13
premium-concern wrote: post #6

Earlier quoted context omitted.

Yep. "Don't buy things if you can't pay for then." sounds reasonable, but some other countries seem to disagree. Not surprised that those countries suffer from government shutdowns over how much the debt ceiling is raised.

>suffer from government shutdowns over how much the debt ceiling is raised On the other hand: The government shutdown because of the debt ceiling seems just like "Stop hitting yourself" on the playground. And Germany's budget is far from balanced.

The myth of the balanced budget.

The article speaks of consumer debt, I spoke of consumer debt.

Government debt is a different thing, and a government without any debt doesn't sound like a wise thing if it is even possible in such a highly integrated and globalised world.

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