Hi from a newcomer

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Hello,

I have been lurking on this forum for years, and finally decided to join you. I am in my 40s and live in Romandie. I grew up in a family that was terrible with money, and I was broke for most of my adult life, but taught myself about personal finances and investing to turn things around.

Hope to meet many nice people here! My dream is to buy my own house one day, which is really hard to do on a single salary, but I’m not giving up. Even if I have to move to France or to some remote village in the mountain :wink:

Currently trying to save enough for a down payment on an old, broken down place. I imagine banks don’t happily offer mortgages on decrepit houses, especially if you don’t have a lot of savings and plan to take years renovating it yourself… Hopefully my stable job and good salary will count for something, but I expect that I will need to save more than 20% down payment. If anyone can tell me if it’s doable (getting a mortgage on an old place without borrowing more money for renovating it) or if I’m crazy, I would appreciate it!

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I think that’s something a lot of children of Boomers can relate to.

It is possible to get a mortgage on an old place if the property is a freehold (you own the land underneath the building), mostly because the building land will count for something. Ultimately it will come down to the property’s appraised value.

My personal advice though would be to focus on saving and investing for the time being. Buying and renovating an old property can be fun, but it’s an expensive hobby. Once you have built up a substantial amount of wealth, you’ll be better able to afford that kind of project.

From a financial perspective, it makes more sense to diversify your savings across different assets, rather than tying everything up in one property. But of course, that logic has to be balance with enjoyment/fulfilment.

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Thank you for your answer, you are right. I need to keep saving/investing. It’s a bit frustrating since I’m already over 40, and every year I save money, then look at the property prices and they have gone up as well…!

And yes I understand that buying a home is not the best logical decision from a financial perspective, I fully admit that it’s an “emotional” dream based on a need for security. Also I would love to be able to renovate and decorate the house or change the garden without having to beg my landlord for permission :face_with_diagonal_mouth:

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I totally get that, as I went through that phase as well. I’m also over 40 :slight_smile:. My suggestion would be to focus on saving and building wealth for a few years, and see how you feel about it after that.

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Imagine if you were saving up not to buy a house, but to buy the VTI ETF.

5 years ago, it cost $177 per share and today $318. Up 80% in 5 years.

Did house prices go up 80% in 5 years?

Think how hard it would be to save up to buy VTI with growth outpacing your savings every year.

Only wait! You don’t need to wait and save! You can buy VTI now and have your money grow. If you’d invested $111k 5 years ago it would be worth $200k now.

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Welcome.

Probably not a house, but land did go up even more I think. Mine went up more than 2’000% in like 25 years.

But wait, my stocks made me even more…

99 out of 100 youngster investors do just buy the mentioned “holy grail”. And that may be OK for most, but I’m not sure they all know of the risk and the risk-return profile of that almost biblical investment.

In investing it pays most not to do what the herd does. Sometimes (ok, almost always) it is better to ignore tips and build your own opinion. You have to take into account knowledge (or willingness to learn), time, risk tolerance and so on. But most important: you have to reach to your own opinion and not just follow the herd.

I hope you will find some points here that enable you to get to your own investment style.

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