How much would you expect back if you gave someone a loan for $500,000.00 after 3 years, 5years, 10years?
Calculations:
After 3 years: 500,000×(1+0.0430⋅3)=500,000×1.129=564,500.
After 5 years: 500,000×(1+0.0438⋅5)=500,000×1.219=609,500.
After 10 years: 500,000×(1+0.0468⋅10)=500,000×1.468=734,000.
Ok so 64,500/3/12=$1792.00 would be your fair monthly rent since the landlord would put that money away and expect a return for that investment.
For 5 years it would be $3,042.
For 10 years it would be $6500. Clearly a better investment.
Except that when they get your rent they can put that money into the investment system again and get much more money overtime.
First month say 1000 (super cheap tent on a cardboard box behind a Wendy’s).
Second month 2040 assuming 4% per month.
$41,000 after 3 years, $67,000 after 5 years, 170,000 after 10 years at 4.3% APR.
If the rent was 3000, that would be $510,000 after 10 years. This is not a good investment if you paid $900,000 for that house. You want the return in 5 years so the rent would be $5708.00 per month.
And that right there is why our rent is so expensive. We are basically ensuring the profit of a nice steady percentage to some investor. Now, if you didn’t ever invest in the house, your house would eventually become land. So you do want to pay to keep that thing looking good, but maybe not 4.3% per month?
What in the world are you talking about? The rent only paying for the interest? You know buildings are not eternal, right? They depreciate in value. They have maintenance costs. And a hundred other things a good landlord should be taking care of.
This is panda level… No, sun… No, koala! Bear minimum. Yeah, you start thinking about maintenance, depreciation, dog damage, robot attacks, invasion by aliens, heck… A pandemic! Now we’re talking serious money. Lol… Not lol.
How much would you expect back if you gave someone a loan for $500,000.00 after 3 years, 5years, 10years?
Calculations:
After 3 years: 500,000×(1+0.0430⋅3)=500,000×1.129=564,500.
After 5 years: 500,000×(1+0.0438⋅5)=500,000×1.219=609,500.
After 10 years: 500,000×(1+0.0468⋅10)=500,000×1.468=734,000.
Ok so 64,500/3/12=$1792.00 would be your fair monthly rent since the landlord would put that money away and expect a return for that investment.
For 5 years it would be $3,042.
For 10 years it would be $6500. Clearly a better investment.
Except that when they get your rent they can put that money into the investment system again and get much more money overtime.
First month say 1000 (super cheap tent on a cardboard box behind a Wendy’s).
Second month 2040 assuming 4% per month.
$41,000 after 3 years, $67,000 after 5 years, 170,000 after 10 years at 4.3% APR.
If the rent was 3000, that would be $510,000 after 10 years. This is not a good investment if you paid $900,000 for that house. You want the return in 5 years so the rent would be $5708.00 per month.
And that right there is why our rent is so expensive. We are basically ensuring the profit of a nice steady percentage to some investor. Now, if you didn’t ever invest in the house, your house would eventually become land. So you do want to pay to keep that thing looking good, but maybe not 4.3% per month?
What in the world are you talking about? The rent only paying for the interest? You know buildings are not eternal, right? They depreciate in value. They have maintenance costs. And a hundred other things a good landlord should be taking care of.
This is panda level… No, sun… No, koala! Bear minimum. Yeah, you start thinking about maintenance, depreciation, dog damage, robot attacks, invasion by aliens, heck… A pandemic! Now we’re talking serious money. Lol… Not lol.
our rent… you mean your rent
Somebody must help these poor landlord asshole billionaire wannabes. Am I right?
Exactly