5 ways to help wage earners buy a home early

Wage income is stable but difficult to break through while real estate is of great value.If not working in high-income fields or doing business, it takes a lot of time for wage earners. New accumulation can buy houses in big cities. How to shorten this distance?
Skill picked up
If you keep thinking that a small salary can not buy a house, home ownership will be more distant. Therefore, if you really want to have a city house, take advantage of the stability of the monthly income for long-term accumulation. Each month, cut off immediately the amount of money that can be saved, only keeping the estimates to spend. When you reach a certain amount of accumulated capital, you can borrow from banks and relatives to buy a house and plan to repay the debt. During accumulation, find ways to multiply your capital, such as dividing money into small investments, rotating investments or increasing income to increase capital …

The initial capital is the basis for you to get close to your intention to buy a house, even if you cannot buy a house right away, it will also motivate you to increase your accumulation, or at least help you have a backup. , be ready for unexpected investment opportunities.

Even if you are not proficient in investing, saving and earning compound interest are an effective way to increase capital flows. For example, you have 10 million savings, interest 8% / year, after 1 year you will have 800,000 interest, in the second year, in addition to 800,000 interest from 10 million, you have an additional 64,000 interest from 800,000, total add up to 11,664,000 and continue to multiply in the following years. Assuming you only save 5 million dong per month, then after 3 years you will have more than 200 million both principal and interest. If it is possible to invest, the initial small capital can be multiplied many times after 3-5 years.

Albert Eistain commented on compound interest. Taking advantage of compound interest helps homebuyers increase their accumulated capital quickly.

Roundabout strategy
If only relying on salary and income without breakthrough, it takes the average salaryman 15-25 years to buy a property, not to mention slippage and price increase amplitude of real estate after each year. So, instead of waiting for money to accumulate, a detour can even shorten the distance to reaching your dream of buying a home. Searching for affordable homes or plots away from the center, renting or staying in temporary accommodation will help you save rent or increase passive income while the property still has a chance to increase in value later. With the balance, you can borrow from a bank or relative. This is the asset value increase problem that many people have successfully applied. After a few resales, you can buy a house or apartment of greater value and closer to the center.

Land investment
The amplitude of real estate price increases in major cities that have completed infrastructure will often be difficult to surge like in undeveloped regions. Therefore, investment in countryside and other provinces is a great opportunity for wage earners with small capital.

Some rural areas have land prices divided into plots or at auction from 300-500 million / lot, even 150-200 million / lot. If a good location is bought, after a few years when the locality invests in infrastructure, the land price may double or triple. Investing in the countryside in addition to the advantage of cheap price, you can easily find out and survey information by yourself or ask an acquaintance to support legal procedures.

Đất phân lô giá rẻ ở vùng quê

Cheap land plots in the countryside Land in some rural areas has a soft price and good profit opportunities. Illustration

5-10 years ago, many people returned to remote areas of Saigon to buy land for 300-500 million and can now sell them for 1.5-3 billion VND, even 5 billion VND. However, finding such a land is not easy, it requires you to take the trouble to learn, come to the place to survey, compare … to be able to “buy cheap, sell expensive”.

Contribute money to buy land together
Although there are many inconveniences and disputes easily arise, this is really a great plan for those with small savings. If it is possible to form a group of 3-5 close people, trust each other to contribute capital and invest in the same land, the chances of bringing in profits will be much higher than “alone”. Because plots of land have a profitable opportunity, a beautiful location will not be cheap or it takes a lot of time and effort to find. When contributing capital, the group buying together will easily find the product and easier to liquidate, the expected price is also better.

In addition, when working in groups, the knowledge and experience of many people also increase the chances of finding a good product, and reduce the risk when the assets are unfortunately difficult to liquidate. With this option, the prerequisite is to trust each other and be willing to invest in the long-term, not rushing to sell off when the market is difficult, or the expected price is not reached, because short-term real estate investment carries. The luck is more, if you have carefully calculated and bought a good property, you can rest assured to wait for the opportunity.

Take advantage of loans
Making good use of loans is like “borrowing the wind to break bamboo shoots”, giving salaried employees the opportunity to own assets of much greater value than their existing money. Borrowing money from relatives or borrowing money from the bank to buy a house on installments are all smart problems for salaried employees who cannot afford to buy off assets. Many people only have 200-300 million VND in hand but are willing to borrow 300-500 million more to buy a land, during the accumulation and repayment of that land can also increase the value beyond the interest payable. However, when you borrow money from someone you know, you need to keep your credit to be able to handle it easily in the next time. With a bank loan, it is advisable to carefully calculate the solvency and do not borrow more than 50% of the asset value to ensure safety.