I think with the post you are citing, we have Renter A, who is funding his 15,000 baht a month rent in Thailand by investing 4MB at 8%. Buyer B has used his 4MB to buy a condo, saving 15,000 baht a month in rent. Which of the two will have more net worth after 20 years? The poster did not seem to take into account that when you own, you have extra money each month, in saved rent. He mentions that the seller has saved X amount of money on rent, but doesn't say what the seller has done with the money. As an owner, you have that extra 15,000 baht a month rent savings every month--in the poster's example--to invest. If a renter can invest and earn 8%, so can an owner. Let's run the numbers through Google and see if there is a vast difference between renting/investing and owning/investing, for someone retiring to Thailand. In both cases, the renter and the buyer are funding the roof over their heads with the 4MB. Here's what we asked Google: Renter A invests 4 million baht for 20 years, earning 8% annual interest. He funds his 15,000 baht a month rent from the money earned by his investment fund. Buyer B buys a 4 million baht condo, saving 15,000 baht a month in rent payments. He invests that 15,000 baht every month, also earning 8% annual interest. He pays his 30,000 baht a year condo fees and 1,200 baht a year taxes from money earned by his invstments. Assume the condo value and the rent stay the same for the 20 years. How much would both have in net worth after 20 years. Also run the analysis earning 6% annual interest. Google's answer: After 20 years, Buyer B comes out ahead in total net worth under both interest rate scenarios, assuming the condo maintains its base value of 4,000,000 Baht with 0% appreciation. At 8% annual interest, Renter A finishes with a net worth of 10,871,905 Baht, while Buyer B achieves a net worth of 11,359,198 Baht. At 6% annual interest, Renter A finishes with 6,310,204 Baht, while Buyer B ends up with 9,761,986 Baht. The above results were similar for 5-years and 10-years. Buying/investing or renting/investing are very close with 8% return. Buying/investing produces 3MB more with a lower 6% rate. The closeness of some of the figures rather surprised me, as I've been sort of brainwashed with all the posts saying how much better you'll do if you rent vs. buying. I've said many times that I buy first because I get much enjoyment and satisfaction from owning and creating the spaces I spend my valuable time in. The investment aspect comes a distant second. I've also said I would buy even knowing I might lose some money--it's worth it to me. That's me, my situation. You have yours. It seems clear to me that with the numbers so close with the 8% scenario, the best option is what it's always been--the one that fits each individual, couple, or family the best. For some, renting could easily be the best choice, for a variety of valid reasons. For some, especially those who prefer the freedom to make changes any time they want and have all their own furniture, art, electronics, etc., buying might be the better choice if one is comfortable with owning in Thailand, is here long-term, has a Thai spouse, etc. As always, there's no one size fits all--do what fits you.
