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A young girl I know has a down-payment on a 1.2mil two-bedroom apartment in a top location. After this purchase she would be able to afford to live 10 years with her current lifestyle costs without working.
Alternatively she could find a one-bedroom apartment for half the cost, perhaps even less in an area further out. She would likely lose the down-payment on the initial apartment.
What do you think of these choices?
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If she's just a young girl, the pricier home is risky. I work a good job and would never want the obligation of a huge mortgage. So go for the cheapest place for sure.
But, she shouldn't lose her down payment if she walks away from the deal. She could even save her earnest money if she plays it right.
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>>1412448
It wouldn't be a mortgage, it's a full-cash deal as far as I'm aware. I may well be wrong.
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>>1412450
So, if she has a down payment, it's a mortgage. But if it's an all-cash deal, that's even worse. The money will be all tied up in one piece of property, which is risky. I'm assuming by the insane price this is in either Canada or Aus. If so, they are ripe for a downturn.
And with her being young, that just compounds the risk.
She probably has no idea about the real value of her inheritance (I'm assuming it's an inheritance) so to her it's probably no big deal, which is dangerous. They also don't even know where they'll want to be living, so a year from now, they could be selling, which means losses on commission, negotiations, more risk. They probably don't know much about real estate, either, so there's countless smaller things that could be problems there.
In ten years, she'd be lucky to not be flat broke, honestly. I've seen it happen.
It's best to put the money away in an index fund, forget about it completely for 10-15 years, rent somwhere for awhile, live her life and discover her direction, what she wants to do, where she wants to live, etc. Then, when she's established, take over the management of her nest egg and figure out what to do then.
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>>1412427
>1.2mil two-bedroom apartment in a top location
unless shes making a quarter of that amount a year, she shouldnt be buying.
housing prices are likely to go down in about 4 years anyway.
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Stop being a white knight and volunteer to help with finances, then run away with the money.
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>>1413843
But she's my girlfriend
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>>1413844
Be a good boyfirend and take care of the financials, then run away with the money.
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>>1413844
marry her and when you're bored divorce her
you'll get her money.
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>>1414106
>best advice
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