Buy or rent a property? Which is the best choice?

Buying or renting a property, what is more advantageous? For the financial sector, buying a property is not worth it, that’s right! In Brazil, the culture of having a property as an investment predominates, but we will explain why having the dream home is not the best choice. An assessment at

Investment predominates

Investment predominates

Recently many people have been thrilled with consecutive cuts in the Selic interest rate and are planning to buy a property, as financing rates are expected to decrease. This is true! However, the problem of the real estate market is precisely in the price paid for the purchase of the property. The values ​​have grown much more than they should, especially between 2008 and 2012, and continue even with the fall in demand. So, it’s no use to the Selic to lower interest rates if the purchase is still high.

Another point to be analyzed is that you will rarely be able to buy a property in the state of investor, because when the developer builds on the land, it invests heavily in its sale. So if you get a brochure from a real estate launcher when, for example, you visit a booth with brokers, you’re there in the position of the end consumer, so you’re not an investor.

The valuation of the property is an illusion

An analogous example of this is the purchase of a shoe in the mall where you pay much more than the cost value of it, and do not imagine that you can make a profit later reselling that same shoe in the same way the property works The developer will sell the property at the highest possible value, regardless of how the market is, the goal is to increase the cost for its shareholders.

Buying a property in a potential region of appreciation is also an illusion, as we must consider that this valuation may take time to happen or just never happen. During this period your spending will not only be on the amount you paid the property, it is necessary to consider the maintenance expenses, which suffer depreciation, although commonly think not. Want an example? Do you own an apartment 15 years ago in a highly prized neighborhood where new buildings have just been erected, which one do you think will be worth more, yours or the ones that have just been built?

In addition, it is rarely possible to buy a property in sight


Since this makes the option even worse, since the financing leaves the property even more expensive, taking into account the interest involved. Although it seems pessimistic, this is a reality that needs to be considered, a marriage in Brazil lasts for an average of seven years, since the financings last about 27 years, although the planning is to be with the person forever, a relationship can end, is even more serious if the breakup occurs in the middle of a financing, as it is the bank that leaves happy in history.

And you believe that buying a property for later renting it is a good deal? Well, investment is still poor, putting in the tip of the pencil, the return on rent is very low, even if compared to unprofitable applications such as savings.

Assuming that a property is worth R $ 500 thousand and the rent is R $ 2 thousand, this gives a return of 0.4% per month. This value is lower than savings, which renumber 0.5% more TR, and in even better applications it is possible to reach 0.9% per month. Even though you wanted to buy a property to live in, the rent pays off more. With R $ 500 thousand invested it would be possible, with interest only, to pay the rent and still have money left over.

They also say that the cost of rents is higher or tied to inflation, and this is not real

They also say that the cost of rents is higher or tied to inflation, and this is not real

The Quick Lending index pointed in the last 12 months that the sale value of real estate increased to 0.46%, a variation lower than the 3.60% of inflation in the period. Already the rents fell to 1.72%.

Regardless of your choice, remember that you can count on the Financial Group for a personal loan online, safe, fast and without red tape! Request yours.


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