At the age of 24 a son/ daughter gets advice saying “do not just waste your money ..buy property”. The property is expected to give you about 23% p.a. for the next 200 years of your life.

So people buy RE to flip it and double their money. Soon.

Now there is a big, big difference between doing a SIP of Rs. 10,000 per month and paying an EMI of Rs. 10,000 per month. When you do a sip it means you have made a down payment..and have borrowed money. So your EMI is a loan repayment.

If you lose your job or if there is an emergency YOU can stop the SIP without any penalty. In case of an EMI you are stuck.

Property prices go up, remain constant or worse prices come down…oops thought of that?

http://economictimes.indiatimes.com/wealth/real-estate/news/real-estate-slowdown-leaves-executives-stuck-with-costly-loans-and-properties/articleshow/49837662.cms?utm_content=buffer9672a&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

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  1. “The property is expected to give you about 23% p.a. for the next 200 years of your life.”

    This is too much :):):)

    although 12% seems possible although mind dosnt believe but heart says yes. Same old arguments of black money, land shortage etc…

  2. Lots of people who have invested in property especially land have made huge money. Agree that it is not easy to advise someone what to buy when and where… no standard approach like mf. But land pays you well…not as bad as buying apartments for investment.

  3. there seems to be this interesting article reg how it is fair to expect only 8-10% returns from BSE sensex, and “Indian stocks give a return of 16% per year over the long-run on average is basically a half truth”. You can take up the topic in any of your future blogposts.
    If this is true, then how to justify the additional risk vs returns wrf PPF (at 8.75%).

    https://www.equitymaster.com/dailyreckoning/detail.asp?date=11/13/2015&story=3&title=Does-the-Sensex-really-give-a-return-of-16-per-year-in-the-long-run

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