Sup /biz/ long time poster here
so,lately i have been discussing with my mom, the folowing argument:
Real state gives you economical security in the long run,its the best way to spend your money.
the thing is, in my country a $100.000 house, makes around $350 a month by renting(which increments 12.5% every 3 months)
meanwhile im looking foward buy a franchise of supermarkets , which costs around 35000 to own + rent per month(around $1200), and makes around 8300 per month , consider this in my country is a lot of money , the minimum salary is around $400
in the long run, is real state the real answer?
It depends on the house. There are a few factors.
Are you financing the house?
What interest rate can you get on the loan?
Does your country have corporations available to put the houses under?
How's the market?
Are houses appreciating or depreciating?
What are houses in the immediate area renting for at the same square footage?
Here in America you can put houses under an LLC which will give you tax benefits in several ways. If you purchase the house through a an IRA with your LLC you can have taxes deferred. And every fix you have to do to the house while the tenants are in, can be written off as a loss (As can depreciation of the house if its a bad market). When calculating the profit for your house to rent out, it's best to not calculate appreciation of the property, as that is pure speculation and you probably don't have enough information to accurately speculate. Will you have a property manager to manage the tenants? It's probably a good idea, they will vet tenants to make sure they have a good history with their rentals, and they will also collect and mail you the money for a small fee, and is totally worth it. Your total profit is up to you, depending on what you feel "safe" making each month. If you want to keep 350 per month after paying the mortgage, then okay. You can use that to save in case you have to fix something, or you can pay the loan down even more. And make sure you have proper insurance for a worst case scenario. There are insurances out there for landlords that in the event of a worst case scenario (house burning down etc.) they will pay for the repairs and also pay the missing rent every month there is a tenant gone because of the damage.
Hope this helps, I'll monitor this thread for any questions you might have.