If you buy a house for the purpose of making money by investing, when the house price does not rise or even fall, the pain after disillusionment is called suffering. If you borrow too much money and add too much leverage, the burning pain will be worse, but it will be powerless.
I believe that people who stand guard in the high position of the property market from 20 17 to 20 18 will have a deep understanding.
Lao Zhang is a member of this group and there will be many stories like him.
After 20 16 skyrocketing housing prices, the shocking scene of 10,000 people robbing houses is vivid. Lao Zhang finally made a move on 20 17, but he stood on Gao Gang.
He mortgaged the house he occupied to the bank and got more than 900,000 yuan. He used most of the 900,000 yuan as a down payment and bought a set of four rooms with a unit price of 140 square meters. He thinks his wealth will be severely hit, his assets will double ... Needless to say, his assets will shrink and he will be heavily in debt.
The old house has to pay more than 6,000 yuan a month (this is the result of a loan replacement in 2020, and the previous interest rate was higher and the repayment amount was higher). The monthly supply of new houses is nearly 1 10,000, and one month is1.6,000. If the living expenses and monthly expenses are not less than 20,000, you should know that Lao Zhang's city is only a second-tier city and an ordinary office worker.
Recently, Lao Zhang's house has to be handed over, but the house price has also dropped from the highest point of189,000 to the current10.6 million, thus losing more than 200,000 out of thin air, but it has encountered a new problem: whether the house should be renovated or not?
Lao Zhang can't get the decoration money. If you get a decoration loan, you will add a new debt, which will undoubtedly make the already difficult life more difficult. And if you want to use the rent income to offset the decoration money, it is simply impossible. I don't know whether to wait until the Year of the Monkey.
Every time I talk to people about buying this suite, Lao Zhang is full of bitterness, waving his hand and shaking his head frequently, and complaining that he is eager to buy a house to earn income.
Although the main purpose of Lao Zhang's buying a house is to invest and make money, he also has the consideration of self-occupation, replacing the small three rooms with the big four rooms. Originally, I planned to wait until the new house was handed over, and then I sold the old house and wiped out the debt, so that I could change the house perfectly and make a profit ... But the premise of this operation is that the house price will rise, and the cruel reality is that the house price will not rise or even fall.
Lao Zhang is miserable, but by no means the worst. Although heavily in debt, his leverage is not broken. His biggest mistake was that he added more leverage than he could bear.
What I am most afraid of is that at the high point of this round of housing prices, those who buy houses for investment purposes have already increased their leverage.
2
There are actually three closed loops about buying a house with debt and leverage.
The first is the investment closed loop.
Buying a house with debt and leverage is not only a 70% mortgage, but even the down payment and monthly payment may come from debt, but there must be an end ... When the house is sold, all previous debts can be settled, and the rest is net profit.
Its premise is that house prices will rise, and the increase in house prices will be higher than the cost of liabilities.
The second is the closed loop of demand.
Loan to buy a house, monthly repayment, the purpose of buying a house is to live for yourself, even if the house falls down, it doesn't matter, anyway, it is to meet your own needs and enjoy it.
Because the income can cover the monthly supply, the lever will not break, and the end point of the closed loop is the demand for self-occupation.
The third closed loop is collapse.
No matter whether it is investment or self-occupation, it may never be able to raise any more money, which will lead to a default in supply, a house may not be sold or even if it is sold, it will suffer heavy losses, unemployment or business failure will lead to a decline in income ... Finally, the leverage will be broken and the debt will be paid off.
This is also a closed loop, of course, the worst closed loop. If there are enough people and money in this form, it will lead to financial system risks, and ultimately all the people will pay the bill.
No matter what kind of closed loop, the underlying logic is that people's income can support this house price.
The closed loop of investment is to find the receiver, and the receiver's income can bear the debt; The closed loop of demand is that the income of buyers can afford mortgages and can last forever; The closed loop of collapse is debt liquidation, which depends on everyone's income.
When housing prices soared two years ago, many people ignored the growth of income and whether people's income could support such high housing prices. Anyway, everyone only saw the rising housing prices and the surging tide of takeover, completely ignoring that these new purchasing power is the last effort after overdrawing six wallets, but it is actually a spent force.
Many people attribute the decline in house prices to the government's regulation of the property market. In fact, supervision only accelerated the decline, and it was in the form of as little loss as possible ... If house prices were allowed to rise, the bubble would expand, and once it fell, the consequences would be unimaginable.
The ultimate goal of the house is to use it, whether it is for residential use, business/office use, or even warehousing and logistics use. However, because of the temporary rise, many people have too many illusions about investing in houses to make money, so that they add too much leverage, but instead let themselves fall into it.
According to the current situation, buying a house will no longer be an investment, but more a consumption, and our logic of buying a house, thinking angle and debt leverage will change accordingly.
three
Behind real estate speculation is the original intention of "buying a house is consumption, not investment", but no one believed it when the central government first proposed it.
Housing enterprises are still in debt and leverage, and they are still using the previous "high leverage/rapid turnover" style of play; For ordinary people, they still believe that buying a house can make them rich, so they are still waiting for the opportunity to buy a house with debt and leverage.
Everyone firmly believes that house prices will always go up: steel/cement/raw materials are going up, why don't house prices go up? Land prices continue to rise, and flour has caught up with bread. Why don't house prices rise? Yang Ma prints a lot of money every year, and inflation occurs every year. Why don't house prices go up?
So there is today's result, many housing enterprises, and even many head housing enterprises have fallen into debt difficulties, and even thunderstorms frequently occur; Many investors who use high leverage to buy at the high point of housing prices not only failed to make money, but also got into debt and faced or experienced leverage fracture.
When people believe a conclusion, they will selectively look for various reasons to prove their conclusion, while ignoring others, resulting in causal inversion.
Because of rising house prices, land prices, building materials, labor and other expenses have risen. Once the demand for houses declines, it will affect the decline of house prices, and the simplest principle of supply and demand will also force the upstream cost to fall. The positive feedback of rising house prices immediately became the positive feedback of falling house prices.
If buying a house becomes consumption rather than investment, how to deal with it?
Four words: do what you can, and decide how much to spend according to your own economic strength, such as income/savings/assets, rather than willful debt and leverage.
Consumption is necessary, and there is no return or the return is difficult to quantify. If you spend money, you spend 654.38+00000 yuan on an Apple mobile phone. How do you quantify the return? And investment pays attention to quantitative returns, making money and losing money at a glance.
When housing prices stabilize and there is no longer a sharp rise, everyone's desire for investment will be extinguished and they will not try their best to increase leverage.
Housing enterprises will mainly use their own funds to buy land, build houses and operate, and then attach appropriate debt leverage; Individuals will mainly use their own funds to buy a house. Even if they borrow money, they will look at their debt tolerance and will not think about finding the next pick-up man.
At the same time, real estate enterprises no longer build various large communities, tourism real estate and small towns in the outer suburbs, and people no longer buy them ... When buying a house becomes consumption, people will see whether they really want to live or not.
In the past, everyone bought a house with the purpose of investment, always thinking about selling it, and some people could make a fortune.
Buying a house is no longer an investment, but a large consumption. This concept is becoming more and more popular ... of course, at the expense of some people who have paid a painful price.