Should I buy a house in Israel?
The checklist for owning a home 12 facts for anyone looking to buy a home
1. Why become a homeowner at all?
Who owns, decides: whether colored walls, flower beds in the garden or a new kitchen - owners of a house or apartment are free to design their home according to their own ideas. In addition, there is no risk of termination. For example, because the landlord claims his own needs. A plus for everyone who plans for the long term. In addition, owning is often cheaper than renting because of the currently low interest rates. Owning as an investment can also be quite attractive.
2. Is it cheaper to buy or rent?
Living in one's own home is still usually cheaper. In contrast to tenants, owners benefit more from currently low interest rates: The costs incurred are on average slightly lower than the rental costs of comparable properties. However, because rents tend to be cheaper, while property prices continue to rise, the ratio shifts in a full cost calculation of tenants. This has already happened in exclusive and expensive locations: Renting is more attractive there than buying.
3. What can I afford?
Buying residential property usually begins with a specific property and the question: Can I afford it? Anyone who approaches a purchase from this side runs the risk of failure. Even if mortgage rates and running costs add up to be lower than the current rent, lenders often say no. The most common reasons for a rejection are too low an annual income or insufficient equity. Therefore the question: What can I afford? The UBS mortgage calculator provides a clue. The short formula is: If the desired property does not cost more than five times the gross annual income and if freely available own funds of 20% of the property value are available, a purchase should be possible.
4. Buy or build?
Today only a minority has the choice between buying and building, because building land in central locations is scarce and expensive. Anyone who owns building land can realize their own dream home. But even those who buy can design: With a purchase from a plan or a renovation, the house or apartment can be adapted to your own needs.
5. Condominium or house?
Since the prices for condominiums have risen sharply in recent years, this is only partly a question of the budget today. Single-family houses cost less on average per square meter than condominiums, so the latter are only cheaper on balance if the living space is smaller. The choice between buying a house and an apartment is often a matter of preference. Homeowners have the greatest possible freedom in the design of their home.
6. How easy is it to resell?
Selling residential property is basically easy in Switzerland because the local real estate market works. The increased prices in recent years are paying off for sellers. As long as interest rates remain low, the risk of a sharp drop in prices is also small. However, if a house has to be sold under time constraints, this can mean lower prices. This risk exists particularly in the case of residential property in peripheral locations, very expensive properties or properties for enthusiasts.
7. Where do you get the loan from?
When it comes to financing a home, buyers are spoiled for choice. In addition to banks, insurance companies and pension funds are also active in the mortgage business. Many also offer their mortgages online. The growing choice means more competition and lower interest rates, but also more work for the borrower. It is worthwhile to check the offers carefully and to take advantage of competent advice. In addition to the interest rate, contractual conditions are also decisive, for example with regard to the termination of the contract.
8. Does the mortgage breakdown make sense?
Dividing the mortgage into several tranches reduces the interest rate risk. When the mortgage expires, the general interest rate level can be higher than the interest rate previously paid. Dividing the mortgage into several tranches with different terms prevents the entire mortgage from having to be renewed at higher interest rates in one fell swoop.
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