Finns Buy Homes Instead of Renting: Here's Why
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- Опубліковано 21 лип 2024
- In Finland, buying a home is a big deal, and Finnish people strive to own whenever it becomes possible. But why is that? In this video, I will share reasons for that.
Sources:
ec.europa.eu/eurostat/web/pro...
www.stat.fi/til/ashi/2021/12/...
www.stat.fi/til/ashi/2016/09/...
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We bought a place a few years ago and as a foreigner, I was shocked at how easy and straightforward the process was especially for flats.
The bureaucracy is quite minimal and there’s no need for lawyers, and in a lot cases, engineers to be involved in the process. Everything was done online but we did actually sign papers in the estate agents just for the fun of it.
The level of transparency is brilliant! The agents in my home country often hide gory details from buyers but here everything is shown ie potential future renovations etc. Its very reassuring.
I’d also say that the supply is quite good in terms of housing types and prices, by international standards, are actually quite stable.
When I consider how difficult and expensive it is to buy a home in my home country, I’m so glad we chose to move back to Finland.
Good stuff! 😃🙌
Thank you Aleksi for making a video about buying real estate in Finland!
This can help a lot of couples and people in Finland!
Thanks man!
the main reason why I don't (can't) buy a house and have to rent is that the prices are much higher here in Germany, I would put my children and children's children in debt (and that was before inflation kicked in). In the last decade, prices have really skyrocketed. Between 2016-2019 alone, house prices in my area have risen by 45% and I don't live in a conurbation or a sought-after city. (You have to be way above the average income) Property in Finland is comparatively cheap, with a slightly higher average income. In Finland, I would do it immediately, it's a no-brainer.
Wow that's crazy. The rich will get even richer.
excellent overview... Thank you!
Glad you enjoyed it!
Hope to see you next year in finland,watching you from Dublin Ireland 🇮🇪
Good stuff! 😃🙌
Was waiting for this video 🤗thank you aleksi
Good stuff! 😃🙌
How does the FInnish apartment ownership system work? You don't own the apartment?! Learn more here: ua-cam.com/video/CYp04b-wSCo/v-deo.html
Well, Aleksi ,I do not if your team realizes this ,but here in Washoe county the Dave's oraganic Bread got up to $7.99 a loaf during Coidiv. Not a good a sign in Mount Rose,NV.
Go figure. Maybe , the good Germans will get the custom Earthships they so rightly deserve at sometime in the near future.
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The quality of your videos keep getting better! Great job!
Glad you like them!
@@AleksiHimself Aleksi, could you make a video about how we can pay less taxes? I believe is the biggest reason why someone wouldn't move to Finland
Quality content! And nice motion design 👍
Thank you! 👍
Thank you so much for this video
Hei Alexsi.
This is a great video. As our plans to moving to Finland get closer and closer. Its interested to see how much your culture incentivizes young people to get their first home.
I live in Australia, and house prices, and home ownership has become a real problem. So much that on its current track, unless I can help my children out by giving them money, they will never own a house.
In Australia I bought our house for $300,000 AUD in 2008, in 12 years our house is now worth $600,000-700,000 AUD. Personally for me that's great, but cost of living and wages not matching these prices increases has caused serious problems with our country. Home Ownership has become very difficult for young people.
Also we have an issue with Investment property. We currently have individuals who got in early before all these prices increases and started a house investment business, we have people that own 44 homes, and have 22 of them empty due to a Tax abuse mechanic called negative gearing. This has caused a Rental crisis right now.
How does the Finnish government handle people buying multiple homes? Is it allowed? Or do people not do this culturally due to it being greedy.
Buying multiple homes is allowed and some people buy investment apartments. Those people pay taxes on the profit so it's profitable for the government, too.
@@AleksiHimself are they given any special tax treatment? Does Finland have any tax incentives for investors to avoid paying tax?
Not really. There are some small things but nothing considerable. You can deduct all costs & interests and the profit is taxed. Setting up a limited liability company allows some tax planning.
@@AleksiHimself In Australia we have negative gearing, which means if your investiment costs you money rather than gains, you can overset the loss against your taxable income.
Basically you can get to a point of paying little to no tax.
And you can easily negative gear, by just making your rentals pay low rent.
@@chimosh Does taxable income include everything (salary + rental)? In Finland, they are taxed separately. If your rental activities result in capital losses, you can only deduct them from capital gains, not earned income (like salary).
After watching your videos, I’ve decided to visit Finland. Interesting country😃
Happy to hear that!
I have been watching you since the time I was in Dubai. I am in Helsinki now. Hope to meet you in the streets of Helsinki. Thank you for the amazing contents. Nahdaan.
Sounds great!
Also in Italy people prefer to buy a home instead of rent It; the 80% of people are owners of their home.🏡😍
it's a big sacrifice, but it's worth it!
Thanks a lot for the video! We are now looking for a house in Rauma. I did not know that you have tax free sale profit if you live in the property for 2 years, I was checking the vero page and I did not see such information. Do you have maybe some friend who is civil engineer? I think it would be a great video to have a discussion with such professional about pros and cons of specific building types, like a wooden houses from 40-50s to mixed brick-wood construction from 60-80s to fully brick cladded houses in 90s. In many European/world countries we dont see such a constructions and we are not aware about risks related to these structures under Finnish weather.
Thanks for the video, very instructive. I have a small correction on your remark of "increasing your wealth". When you move money from one type of asset (the bank) to a different type of asset (mortgage) you are not increasing your wealth. You just move wealth from one asset to another. Due to interest rate, inflation and house price fluctuation the complete picture is a bit more complex. Imagine buying for 300.000, paying off 10.000 and selling for 290.000. Paying attention to where you buy and how long you plan to stay is certainly worth the research effect. Thanks for your video m8. Very instructive!
Thanks! What I meant is that the bank owns the apartment through the mortgage and every month your ownership will increase as money moves from the bank to "the walls". Also, the way I see is that debt is a liability not an asset: as the debt goes down, your wealth goes up.
The prices can go down, as we saw in the 90s. However, choosing a good area has resulted in price increase in the past (but not always). The experts estimate the prices will decrease until the end of 2023 but then they will start going back up.
@@AleksiHimself Of course, asset and liability are similar but opposite. The equation for wealth is normally ´assets - liabilities = equity'. So moving money across does not increase wealth. But it will decrease future losses (interest payed to mortgage) and decrease future income (interest received from savings). Looking at the area map you showed, comparing 2022 with 2015, the area definitely matters long term, irrespective of the ups and downs of the market. For me that means I would like to get my hands on that survey, as I am moving north next year. Deciding whether I go to Helsinki, Jyväskylä or Rovaniemi. So I am very interested in your video. Thanks again for your explanations.
You are also not paying rent to someone, instead paying part of the mortgage
thank you for the content Aleksi! it was really helpful! I followed my friends this year to open an ASP account but honestly I didn't know too many details about it. This video explains a lot. Could you also recommend some agencies or websites where we could find some good apartments for sell?
Great to hear! The main websites for apartment hunting are etuovi.com and oikotie.fi
I have a quick tutorial in this video ua-cam.com/video/UkLsSxRobWg/v-deo.html
Nice advice Aleksi!👍🏻👍🏻👍🏻😁😁
Thanks!
@@AleksiHimself ole kiltti! Mitä kuuluu?
Thanks for all info. Wish we have a house. Although in small town. Like Salo
Maybe one day!
Hi Aleksi, Really great video. Is there any video related to building the house ?
Not yet!
Aleksi thank you so much for the content. I'm in Finland for almost 2 years and I learned about ASP last year. I lost a year :/ I think exaclty same with Finns about buying home.
Can you make video about buying cars, diesel, petrol and hybrid and costs in Helsinki etc?
I'll see what I can do!
@@AleksiHimself I can buy you a coffee for that :D
Thanks!
Excellent video Aleksi!
For those who want to do ASP, you should really do it ASAP, because flats are being more and more expensive. Let say your target flat costs €360000, then you need at least 12 quarters, or 3 years to save that 10%... If you see some good flats during this period, it is rather embarrassing whether to wait or not (my experience now...)
Maybe a workaround is, find a partner who can also open an ASP 😂
Thanks Harry! You are right. If you have plans to buy sometime in the future, opening an ASP account now is beneficial. If you end up not buying, you can always cancel the ASP and get the money back.
We missed ASP due to our ages but another way is to see if your Union has a deal with a bank. My partner’s Union was able to secure us a preferential interest rate and a deposit reduction. You can also ask your bank and they may recommend a Union they have a deal with.
@@Whatshisname346 yes. Danske Bank has this deal as far as I know. :)
The way I see it is that the investment on a house is not determined only by the difference between the sell price and the buy price. You need to factor in costs like maintenance, renovations, inflation, sell/transfer/inheritance taxes and so on. A house in ownership is an endless pit of money. That can take a big portion of the initial pie. Plus big part of your money is locked in one place, you cannot move it. Plus you are also locked in one place, unless you rent the house (provided you bought it in a demanded area). Plus that money is not instantly liquid. Plus the assumption is that the house prices always go up (but it can go down as well, as we saw it in 2008 crash). Plus prices are already crazy in cities like Helsinki, where mortgages can tie you up to 40 years, and I hate debt.
I was thinking going to buy a house from Finland, thanks 👍
Best of luck!
Interesting video. Kiitos!
Can you make a video about buying a house or apartment in Finland for someone who is not a Finnish national. I would like to move to Finland once I retire. I currently am living in the USA and already have enough saved to buy a house or apartment there. Thanks 👍
Thanks for the comment. You would need a residence permit and currently there is no residence permit for retirement. The grounds are usually studies, work or family ties.
@@AleksiHimself okay. Thanks for letting me know this. 👍
¡Gracias!
Thanks a lot!
I was looking at an apartment and I went as far as getting a loan offer from my bank. For an apartment, that is sold for 214 000e, I would have gotten a loan for 25 years and in the end I would have ended paying the bank 309 000e. So I would have bought an apartment worth 214 000e and paid 309 000e for it. Of course I would then own it, but I would still have to play the maintenance charge. Would the apartment be worth 309 000e in 25 years? Who knows. What if I would still play rent of 700e and invest the difference, because my loan deduction would be much higher than the rent. I could invest 500e each month and with 5% annual revenue, I'd have almost 300 000e after 25 years.
Just food for though from another point of view :)
It's a fair point, especially now that interests have gone up. Doing the math and figuring out what's important to you is the key.
You can also do both: paying off the loan and investing.
This is very informative were just starting our life here in Finland as a family and we are considering about this since were planning to settle here. Aleksis does Spankki has this ASP?
Yes, each bank offers ASP Including S-Pankki.
Thank you be talking about this kn the bank then,any way for now where renting and we need to look up for a new place can you recommend a good site to look for an apartment or house to rent?
@@kitzzrellemoore5768 vuokraovi.com sato.fi lumo.fi
Any suggestions about which areas are better and cheaper to buy in uusima area?
It really depends on your budget and preferences. The rule of thumb is that the further away from Helsinki, the cheaper it gets. I recommend doing research using etuovi.com and oikotie.fi
Please Aleksi, after sometimes try to ask another banks for offers. 348 lyhennys and 283 Korko is high. I bought my first house in 2013 and have been paying too a higher interest rates. It was last year (too late) that I realized that and I message my bank that I have been applied for offers from other banks and they should give me another offer on my loan. I have been paying more than 2000 euros every year in interest since 2013. Last year when I told my banks about me getting offers from other bank, they called me and updated their offer, my interest last year was 800 euro compared to 2000 euros I have been paying since.
This is exactly what we did before buying. We got number of offers and negotiated the interest rate to 0.4%. However, because the interest has gone up, the current rate we pay is 2.3%. There is nothing we can do to make it lower because the rate is tied to Euribor 12 months.
At some point we can try to get an offer that is tied to Euriobor 6 months.
Hey, very useful video. Where can I search second hand cars in Finland?
Try nettiauto.com
Thanks, man! @@AleksiHimself
I moved to Finland 8 months ago. Do you know if there's a minimum time one has had to spent in Finland, say 1 year, before applying for the ASP scheme? I looked around but couldn't really find any info on that.
I don't think there are any restrictions for that. Keep in mind that you should not have owned homes in your home country.
@@AleksiHimself 👍
I have not been able to understand a few things yet, even though I tried searching.
1. Do I get it right, that you normally do not buy an apartment/house outright, but have a mortgage? If so, what do you pay besides mortgage? Is it that mortgage is rahoitusvastike and you also pay hoitovastike?And utilities, of course.
2. Once you finish paying mortgage, meaning, you no longer have debt, does it mean you only pay hoitovastike and utilities?
If you buy a house, you own the house. If you buy an apartment, you own shares of housing company.
The mortgage is paid to the bank. Hoito and rahoitusvastike are paid to the housing company.
Hoitovastike is used for everyday common costs of he building.
Rahoitusvastike is used to finance the building's big renovations.
This video explains more: ua-cam.com/video/CYp04b-wSCo/v-deo.html
Hi, I've just started looking around to buy a house with a fenced in yard in finland. We're coming from Australia, and yes, I can purchase there. Finnish citizen ❤️ except I only lived there for the first year or so of my life. I find the real estate websites very user unfriendly. Why is that? Some have useable search engines, others require a personal one on one interaction with the agency (these ones will lose me as a customer) so they can contact me about my needs. I don't want to chat with agencies that aren't going to help me, and I don't want to give them all my contact details. Which agencies do you recommend for website user friendliness?
Hey. You only want to go the agencies if you want them to help you find what you want.
If you are looking for listings only, use etuovi and oikotie. I think they are quite user-friendly, but in Finnish only. You don't need to give any info of yourself.
Check this video ua-cam.com/video/UkLsSxRobWg/v-deo.html
Can you make a video on emi payment on buying household good or electronics from finland stores ?
Let's say if I want to buy a laptop ,Can we pay in installments for 18 or 24 months ??
Is it possible
I believe most stores offer instalment payments. However, if you have lived in Finland under 2 years, it may not be possible because you have not established credit rating. Go to the stores and they will tell you more.
Hei Aleksi , is it possible to buy house for me with residence permit in Finland ? Do i need a permit from ministry of defence to buy house?
1st question: yes, if you get a loan (or have enough cash) .
2nd question: Yes. If you are a non-EU citizen and buy a house, not an apartment, you need permission from the Ministry of Defence. Most applicants get it.
I come from the UK where owning a home is a big part of people's retirement plan, so it was important to me to own one after moving to Finland. It took a while to get approved for a big enough loan, but I finally bought a house with ASP savings this time last year. I already had existing savings so I transferred the max amount every quarter and got some very nice interest out of it :)
That's great to hear! How was the process? Was it difficult to understand the documents?
@@AleksiHimself I am lucky to have a Finnish partner, who can translate, and the bank (Nordea) did much of the customer service in English. It was very straightforward and we had no issues!
Hi aleksi I'm coming to finland next year with my Finnish wife and daughter we are looking to buy a house we have a Finnish bank account how long would we need to be in Finland before they grant a loan?
It really depends on your finances, I believe. Send a loan application after you've moved and see what they say.
Is it better to buy a house from a realtor or direct seller?
Do you mean if the seller is using a realtor or not?
It doesn't really matter. Many sellers use a realtor to help through the process but from seller's perspective, there is no big difference.
Thanks
Thanks a lot Sinem!
Can you give an insight of someone who is not an EU citizen. Still have a residence pemit but soon will be permament. Can someone eligble still to buy a house with residence permit even tho he/she can afford it and have a permanent work already. Financially stable too.
Yes, you can. The residence permit stuff is about the banks and mortgage. If your permit is about to expire the bank wants to be sure that you will get your permit renewed and you won't leave the country.
Thank you for this video, I have a question about the first time buyer tax thing, it says if it's your first time buying a house, you wont pay the transfer tax, what about if you already owned houses in another country ? Keep up the good videos
If you own a house in another country you are not considered a first-time buyer in Finland. Have recently gone through this process and I remember that I had to tick some boxes confirming that I do not own any other properties elsewhere
Unfortunately it's just like Katherine said: if you have owned a home in your home country, you do not qualify as a first-time buyer.
@@AleksiHimself @KatherineJoanna , Thank you both for your replies, I appreciate it. But I still have one more question that is quite tempting not to ask HAHAHHA, So what if you sold the houses you already owned in your home country and you don't own anything anymore would you still be considered a non first time buyer? I am sorry to ask I am just thinking about little details . THANK YOU
@@ismailamenzou8009 that would not help because you would not be a first time buyer because you had previously owned.
@@AleksiHimself Thanks Aleksi for the fast response, OK I see, I actually just thought of another tempting question but I dont want to turn this into a consulting kinda thing HAAHAHAH :) , anyway thanks .
quick question. is it possible to get a visa to live in Finland without a job or anything but you have more than 1 Million Euros in your bank account?
Quick correction: you'd need a residence permit, not a visa.
The answer is most likely no. You need to have grounds for the permit and money itself is not enough as far as I know.
@@AleksiHimselfOh right, I see. Thank you for your quick reply! I have plans in making my own business in Finland, but it's quite hard I think because it isn't anything related to tech or really innovative things that people usually do.... Im thinking about subbing to your online course about Finland to see how exactly this all works and I might have missed some things :)
As a German citizen, am I allowed buy house in Finland?
Yes
I'll dare to share my opinion, before watching the video, that it seems to me that's ideal for most of the people, but it's not accessible by the law and the amount of money people have to pay. I hear, for example, in the USA, they need a credit score which doesn't make sense most of the time. I guess in Finland, there are less barriers to it. But, I'll see now. 😁
Thanks for the insights! It's the same here: not everyone has the money.
Going to Nordea tommorow to open up ASP account.
Great idea!
♥️♥️♥️♥️
Thanks!
I’m going to land in Helsinki in 3 hours 😮
WTF = Welcome to Finland!
@@AleksiHimself They say if you look out the plane’s window right before you land you find the secret city in the clouds ☁️ called heavenfloati 😆
Some of the advantages of owning a home is that there is no landlord raising your rent every year. You can sell the house and get some (or even make a profit) of your money back, and you have a feeling of having a permanent rather than temporary residency. Women are more impressed with a man with his own nest than a renter guy.
The disadvantages are home repairs: you have to fix broken things out of your pocket such as hot water heater, roof, plumbing, and other things. If you are feeble, or not a handy-man, you will have to pay someone to fix this stuff, and the older the house gets the more stuff breaks.
Property taxes can be very high in certain areas, as high a one or two mortgage payments.
That applies to houses yes. In apartment buildings, the maintenance fees can go up.
"Women are more impressed with a man with his own nest than a renter guy. ". And that is a sad reason to buy property.
But if you sell an existing property here in Finland & buy another, you shouldn't have to pay capital gains tax. That's how it works in the US & UK.
You don't if you live in the property for two years.
Yes it's so easy to buy a house.
Good stuff! 😃🙌
WHAT?? 348 lyhennys and 283 Korko??? 🥴 Where’s the 3,8% in there? 😅 That’s like 45% interest rate 🤦🏻♂️ I don’t get it…
The interest is calculated from the remaining debt, not the monthly payment. In addition, the repayment method and loan period affects the exact number.
Waiting for the tax deductibles video.
Coming soon! Meanwhile, check the official info here www.vero.fi/en/individuals/tax-cards-and-tax-returns/income-and-deductions/tax-deductions/
finland home ownership 48% it not high
Purchase the deal... 😀
Incentivising first-time buyers is a really good solution, but is there a mechanism for deicentivise multiple property ownership? In most European countries the biggest problem in the home ownership market is that properties are being bought out by moguls for renting, which artificially creates a shortage and increases prices. Even though new apartment complexes are build all the time in big cities, the waiting lists are sometimes very long because some asshole buys all of them. Some more socialist countries might have an extra tax for this kind of people, is Finland one of them?
Olisin kiinnostunut real estate
If the State needs to save some money, they should save money by spending less.