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Why I Bought My First House Cash

Why I Bought My First House Cash

My reasons on why buying cash my house, why you should to, and how

Muhammad Alif Akbar

March 20, 2023
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  1. Why I Bought
    My First House
    Cash
    And why you should to.. 🤫
    Mex Engagement •

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  2. at Grab
    Hello I’m Alif
    Senior Software Engineer, Mobile
    linkedin.com/in/muhammad-alif-akbar
    Software House → E-Commerce →

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  3. Table of Contents
    Financing Option
    Why Cash
    Selecting Property
    How To Cash

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  4. Selecting Property

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  5. Purchasing Goal
    Why someone buy a house
    source: indiatimes.com

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  6. Purchasing Goal
    Why someone buy their first house
    *Not actual survey, only for artistic purpose
    8 of 10
    people
    Buy a home/living place

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  7. DEPEND ON THE GOALS, YOU MIGHT HAVE
    DIFFERENT CONSIDERATION OF
    SELECTING A HOUSE.


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  8. source: indiatimes.com
    Factor that homebuyers consider
    Also affect the home price
    64%
    Size /
    Living Space
    75.4%
    Price
    57%
    Proximity to
    school / work
    44.3%
    Amenities like
    gym, mall, etc
    21.9%
    Scenic View

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  9. Exclusive for Indonesian 😘󰏙
    Also affect the home price
    *Not actual survey, only for artistic purpose
    #1
    Access to
    Clean Water,
    Electricity,
    and
    4G Internet
    #2
    Not in
    Flood Frequent
    Area
    #3
    Free of
    Begal Area

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  10. Financing Option

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  11. How to actually buy?
    These are the norms in society
    Mortgage (Fixed Rate)
    Mortgage
    (Adjustable Rate)
    Cash

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  12. https://www.mortgagecalculator.org/calcs/fixed-vs-arm.php

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  16. Why Cash

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  17. Not
    Bad :)
    Naive Calculation
    How we naively think how mortgage works
    5%
    Interest Rate
    Find Loan
    with loan
    Rp 300M
    Rp 315M
    1.75M / mon
    15 year

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  18. Not
    Bad :)
    Naive Calculation
    How we naively think how mortgage works
    5%
    Interest Rate
    Rp 315M
    1.75M / mon
    15 year
    Find Loan
    with loan
    Rp 300M

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  19. First, it’s not interest on overall, but yearly
    5%
    Interest Rate
    (Yearly)
    ?
    Find Loan
    with loan
    Rp 300M
    How It Really Calculated

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  20. Banks Get Their Money First
    Any type of mortgage makes you pay debt upfront – Flat Interest
    Payment
    Time
    Principal Interest

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  21. Banks Get Their Money First
    Any type of mortgage makes you pay debt upfront – Effective Interest
    Payment
    Time
    Principal Interest

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  22. Banks Get Their Money First
    Any type of mortgage makes you pay debt upfront – Annuity Interest
    Payment
    Time
    Principal Interest

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  23. How It Really Calculated (Simplified Annuity)
    Second, it’s a rate on your debt (5% / 12 month = 0.4%)
    Mon Debt Interest (0.4%) Payment Principal
    1 300.000.000 1.200.000 1.750.000 550.000
    2 299.450.000 1.197.800 1.750.000 552.200
    3 298.897.800 1.195.591 1.750.000 554.409

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  24. How It Really Calculated (Simplified Annuity)
    Second, it’s a rate on your debt (5% / 12 month = 0.4%)
    Mon Debt Interest (0.4%) Payment Principal
    288 5.107.379 20.430 1.750.000 1.729.570
    289 3.377.808 13.511 1.750.000 1.736.489
    290 1.641.319 6.565 1.647.885 1.641.319
    24Y Rp207,397,885 Rp507,397,885 Rp300,000,000

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  25. First, it’s not interest on overall, but yearly
    5%
    Interest Rate
    (Yearly)
    ?
    Find Loan
    with loan
    Rp 300M
    How It Really Calculated

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  26. First, it’s not interest on overall, but yearly
    5%
    Interest Rate
    (Yearly)
    Find Loan
    with loan
    Rp 300M
    How It Really Calculated
    Rp 507M
    1.75M / mon
    24 year
    ↑69%

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  27. SOME MIGHT PREFER MORTGAGE, DUE TO,
    IT BREAK DOWN COST TO SMALLER SIZE,
    SO THEY COULD INVEST MONEY TO
    OTHER HIGHER RETURN THING


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  28. How To Cash

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  29. Save More
    - Higher Income, Same Spending
    - Same Income, Less Spending
    - Same Income, Less Tax*

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  30. Invest More
    - Buy higher return assets
    - Hedge fund to against inflation
    (buy gold)
    - Donate all money to charity*

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  31. https://www.bni.co.id/emerald/produk/kalkulatorinvestasi

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  32. Mixed Approach
    - Buy affordable one, While keep saving
    - Sold, when next target is affordable
    - Ask your parent to buy it as wedding gift*

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  33. Buying a property is like getting married. You have to stay
    logical (not emotional), full of considerations and well planned.
    Fixed rate mortgage tends to be cheaper overall but might seems more
    expensive at first.
    Paying cash can save you money and better on your mental health
    😉
    There is no best options. Everything is actually depends
    on specific individual needs
    Key Takeaways

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  34. Muhammad Alif Akbar
    Mar 20, 2023 | MEX Engagement • KSS Vol. 1

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