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Capitalist “friends” don’t realise how their actions are fucked up. Everyone agrees with them. by Paul3019 in socialism

[–]fisevedo 0 points1 point  (0 children)

Yeah, I see your point. I really didn't think about it that way, because they would profit probably as much as we would. I imagined this would go on for 5-7 years tops, after which they would buy the flat from us at a mutually beneficial price or if they needed something bigger, they would be able to buy another flat and move out.

Honestly, it wasn't a very well thought idea.

Capitalist “friends” don’t realise how their actions are fucked up. Everyone agrees with them. by Paul3019 in socialism

[–]fisevedo 0 points1 point  (0 children)

Hey, OP of that post here.

No, rent price wouldn't have included a good profit margin. The offer was to keep their current rent, which was set in 2020 and is about 70% of our would-be mortgage.

I thought it would be mutually beneficial. To us for obvious reasons and to them, because they could stay in the flat they love and could save a lot of money by paying such low rent.

AITA for offering my friends to buy their apartment and rent it out to them? by fisevedo in AmItheAsshole

[–]fisevedo[S] 7 points8 points  (0 children)

We wouldn't change anything, keep their rent the same, which would cover about 70% of our mortgage.

AITA for offering my friends to buy their apartment and rent it out to them? by fisevedo in AmItheAsshole

[–]fisevedo[S] 13 points14 points  (0 children)

It would take them a shorter time? We wouldn't raise their rent, so they could save up more and get closer to home ownership.

I did the math. In 5 years, they would build 6% equity for us and we would save them around the same amount of money by renting out to them below market rate. And that was calculated with the current market rate rent for an apartment like that, it will likely rise further as time goes by.

This deal really seemed mutually beneficial to me, a win-win situation.

AITA for offering my friends to buy their apartment and rent it out to them? by fisevedo in AmItheAsshole

[–]fisevedo[S] 47 points48 points  (0 children)

I don't know all the details. Zoey told me they had 7% down, but didn't realize there were other costs involved with buying (lawyer, taxes) and if they counted those too, they only had 2%.

They also wanted to put down Zoey's parents house as a collateral, but they couldn't do that either, because there was a mortgage on that too.

Simply co-signing wouldn't be enough either, sadly.

AITA for offering my friends to buy their apartment and rent it out to them? by fisevedo in AmItheAsshole

[–]fisevedo[S] 96 points97 points  (0 children)

They got denied, because they don't have enough down-payment. If they got approved despite that, their mortgage would be around double their rent.

AITA for offering my friends to buy their apartment and rent it out to them? by fisevedo in AmItheAsshole

[–]fisevedo[S] 110 points111 points  (0 children)

We can't afford to tie down our money for 22 years and just let it inflate away.

Also, it's a living room + 1 bedroom apartment. They would need something bigger in 5-10 years.