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Most Germans don’t buy their homes, they rent

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

#401

Post by mahyarm »

ygra wrote: post #362
mahyarm wrote: post #317

Earlier quoted context omitted.

How does germany deal with the crazy tenant that destroys the place but still pays their rent? Is it an expensive and long drawn out process involving eviction court or is the security deposit very substantial?

Can be hard to fight for a landlord. Since tenancy is a very asymmetric contract (since one party's livelihood depends on having a home and the other party is merely inconvenienced if there's no tenant), tenants have vastly more rights than landlords. Terminating a contract can be done if the tenant is behind at least two monthly rents in payments, or if the landlord has personal interest in the property (Eigenbedarf…

I wouldn't call it "merely inconvenienced" depending on the landlord and situation.

Elderly people who are renting out a spare unit usually can't afford large amounts of damages or court fees. Also if your mortgaged backed it can be fairly financially ruinous while your waiting for repairs to be done and you have no rental income. People who also ruin places tend to be judgement proof too.

I'm guessing Germany is more civilized than SF, so these worries are not as high, but I suspect it's part of the reason why places like berlin have supply issue despite a %5 vacancy rate in some buildings.

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

#402

Post by kgwgk »

kiyundai wrote: post #388
kgwgk wrote: post #198

Earlier quoted context omitted.

Do you have any reference for the French "cartes de crédit" not being the same as the credit cards elsewhere?

disclaimer : I'm french Strictly speaking a credit card is a "carte de credit", however between the simple translation with english, the similarities between the form factor etc, A LOT of French (especially not used to the US credit card) will call their debit card 'carte de crédit' Their is a lot of confusion on this, but most of the time french people use debit card. In fact I think banks almost don't advertise cre…

mtw's message was in reply to someone talking about credit cards, as opposed to debit cards ("most people use the CB, but"). But maybe he didn't notice. And I don't know if the figure quoted there is good. Elsewhere [1] I found 20 million credit cards, instead of 34.

[1] https://www.fca.org.uk/publication/market-studies/ms14-6-2-c...)

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

#403

Post by egeozcan »

MrFoof wrote: post #389
egeozcan wrote: post #166

Earlier quoted context omitted.

> the bank sure as hell isn't counting your cash for free I thought there is a machine for that? Also, isn't it possible just to use an ATM?

Every bank I checked (and I checked DOZENS) charges business customers to count cash beyond a certain amount. For my business, the amount is cash in excess of $20,000/mo. Yes, they do use a machine. Yes, they still do charge you for it to count your money if you bring in more than that threshold in a given month. This is for business accounts, which have vastly different fee structures than consumer accounts, because…

Well, I think it depends. Accepting capital and selling a fraction is how banks make most of their money. Making that process as frictionless as possible would make sense but if all of them are doing that, then there's probably some cost associated that I can't estimate properly.

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

#404

Post by Grishnakh »

cm2187 wrote: post #130
riprowan wrote: post #126

Earlier quoted context omitted.

> There is no reason to favor individuals investing into an unproductive investment (property) over productive investments (stocks and bonds). I beg to differ. I think that real estate, like farming, has critical societal benefits that are worthwhile to develop and maintain. Namely, it is very difficult to raise a family of four in a mutual fund. Investing in a home may is absolutely "productive." See, there are sign…

> Namely, it is very difficult to raise a family of four in a mutual fund. It is difficult to ski without skis. But most people don't buy skis, they rent them. Renting skis do not mean that no skis will be manufactured. There is a need for house, houses will be constructed, irrespective of whether people will over-bid on them or not. > A paid off home is a social safety net against homelessness Stocks and savings are…

>It is difficult to ski without skis. But most people don't buy skis, they rent them. Renting skis do not mean that no skis will be manufactured.

That's a ridiculous analogy. Renting vs. buying skis is like renting a hotel room vs. buying a condo when you spend a weekend in a different city. There's a good reason hotels are profitable businesses: no one wants to buy a home if they're going to spend 2 weeks or less in a location.

A better analogy is cars: what kind of moron would rent a car for commuting to work every day? No one, because it'd be a massive waste of money. Rental cars are for people who only need a car occasionally, or who are traveling by air and can't bring their own car with them. Otherwise, it's much cheaper to just own your own car, so you aren't paying tons of money to some company in the form of profit.

>Stocks and savings are equally a safety net against loss of primary income.

The 2008 crash disproves this, as does every stock market crash throughout history. Right at the moment you need that money the most, because the crash caused you to lose your job, your stock portfolio has tanked. This isn't the case with houses: if you own your house outright, you're safe (as long as you keep paying property tax, which is minimal in many places), and even with a mortgage, the terms of the mortgage are constant so you can budget for the payment and keep that much liquid cash on hand. Rent, OTOH, can change whenever your lease expires, or even at any time if you're on a month-to-month lease.

>The cost of housing (renting) would be much lower in a country without massive over-bidding on property.

And which country is that? Somalia? Every time I've looked at rents in Europe, they're much higher than here in the US, along with cost of living in general, even after our price inflation in the wake of the 2008 crash.

The simple fact is that, when you rent, part of your rental price goes to pay for profit for whoever owns the property. If there were no (or little) profit in it, no one would bother being a property owner. When you own something, you take the middleman out of the equation.

Do you also think it's a good idea to rent things like computers, printers, phones, furniture, appliances, clothes, cars, etc.?

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

#405

Post by premium-concern »

DasIch wrote: post #354
premium-concern wrote: post #134

Earlier quoted context omitted.

> political brinkmanship and finger-pointing The difference is that parties that try to pull that in Germany not only loose elections, but are punished so hard by voters that they can't even get over the necessary 5% requirement in the next election. Have a look what happened to the FDP after they pushed through lower taxes for hotels.

In Germany not passing a new budget wouldn't let to a government shutdown. So it's not an option anyway.

Even if it did, it wouldn't matter, because people would vote those politicians that tried this shit and their party out of office.

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

#406

Post by aianus »

matthewowen wrote: post #272
aianus wrote: post #165

Earlier quoted context omitted.

It takes ten minutes to earn $10 doing software engineering. In no universe am I cooking a better meal in less time.

Can you spend 10 extra minutes and earn an extra $10? This mode of thinking is interesting, but it's usually overrated as a way of deciding on time value. Most people have a job that takes some time and pays some money, but they can't arbitrarily work a little longer for a little more money as they desire. This isn't to say your time value might not be high enough to justify not cooking... but it's usually a complex…

Yes, I was a contractor billing in 15 minute increments until a couple of weeks ago. I haven't cooked so much as an egg since college.

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

#407

Post by pluma »

premium-concern wrote: post #382
pluma wrote: post #297

Earlier quoted context omitted.

Sure, but the difference is that they actually invest it. Normally the money pretty much just sits there.

Given the size of the deposits, and the ROIs of available low-risk investments, does the difference really matter? Skip a single CappuFrappeGingerPumpkinLatte (or what people buy in cafes in SF) and you just got more money than any investment on the deposit can ever make.

Depends on the size I guess, but generally that feeling of "oh, look, my money did some work for me" leaves tenants with some happy thoughts on moving out.

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

#408

Post by AjithAntony »

alistairSH wrote: post #341
AjithAntony wrote: post #337

Earlier quoted context omitted.

> If the paint in my personal home starts peeling, my incentive to fix it is higher - I don't want to walk down the hall and see peeling paint. > If the paint in a corporate-owned tenement starts leaking LOL. It's the opposite effect. If I own the place, and The paint is peeling, and I have to fix it... then maybe I'll just live with it until it gets worse, or I plan to sell. If it was a rental, then I complain to th…

Are you married? Own a house? ;) What incentive does the landlord have to fix minor problems? It costs you more to move/sue than it costs him to sit on the problem.

Yeah, not married, so there is not that particular stakeholder motivating cosmetic repairs.

As a landlord I want my current and future tenants to respect the valuable asset I have entrusted to them and maintain a good relationship. Fixing the little things is important in a "broken windows theory" way.

"the cobbler's children have no shoes"

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

#409

Post by SyneRyder »

ar0 wrote: post #225
SyneRyder wrote: post #119

Earlier quoted context omitted.

That's really intriguing. The fees you're describing are the same in Australia (2.9% on AmEx) and don't seem particularly evil at all. A few stores do charge a credit card surcharge here, but the majority of retailers don't anymore. As a near-annual visitor to Germany, it drives me nuts that I can't use my Australian credit card everywhere (especially at Saturn). I would LOVE to have an EC card, but it seems there's…

DKB Bank (dkb.de) offers German bank accounts for people living outside of Germany (and they're even free). You'll get a Visa card and an EC card with it. However, I am not sure if this also applies to Australia or only to other European countries. But if you're really interested it might be worth checking it out. (Also, I think their website is only available in German, so you would need to understand / find someone…

Wow, thanks for this! That looks really helpful, and they do list Australia in the signup process, so that's a good sign. That's the best lead I've had yet about banking!

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

#410

Post by andreasklinger »

mistermann wrote: post #100
mto wrote: post #19

Earlier quoted context omitted.

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 bef…

> We live in a small to medium size flat for 380€/month, including some running costs. Buying it would cost roughly 250k. Wow that's a pretty insane rent to purchase price ratio, seems not that dissimilar to Vancouver which is a gong show.

my guess:

it's an old rent contracts and the newly-rent-value would be around 600

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