Question on house loan

[RetireJapan]

Stupid question but is the home loan tax refund applicable for mansion as well?

It applies to properties newer than 25 years old (our manshon was 25.5 when we bought it, d'oh!). Older properties can also qualify if they have certain earthquake certification I believe.

[Jansen]

Question to all of you with mortgages, do you intend/expect to keep working for the remaining period of the mortgage or do you see yourself clocking out may be midway and paying the remainder with savings, or even a reverse mortgage.

I'm curious about the thought process, risk assessments if any.

[ricardo]

Question to all of you with mortgages, do you intend/expect to keep working for the remaining period of the mortgage or do you see yourself clocking out may be midway and paying the remainder with savings, or even a reverse mortgage.

I'm curious about the thought process, risk assessments if any.

No, I’m going to retire and pay it all off when I’m 60 from the proceeds of a company pension scheme I’m 52 now.

What do you mean by “a reverse mortgage?”

[RetireJapan]

Question to all of you with mortgages, do you intend/expect to keep working for the remaining period of the mortgage or do you see yourself clocking out may be midway and paying the remainder with savings, or even a reverse mortgage.

I keep flip-flopping between making extra payments to get rid of it and keeping the loan for as long as possible as I believe my cash is worth more invested (loan is 0.5%).

We are also likely to sell the property in the medium-term (5-10 years) so I assume we will have to pay off the loan as part of that process.

[Cracaphat]

Question to all of you with mortgages, do you intend/expect to keep working for the remaining period of the mortgage or do you see yourself clocking out may be midway and paying the remainder with savings, or even a reverse mortgage.

I'm curious about the thought process, risk assessments if any.

All being well,our loan should be paid off when I hit 65. Now 51,so we'll continue marching on till that's done.Once paid off,plan to drastically cut down the teaching gig.The continued doing of "head,shoulders,knees and toes" has a shelf life.Or should I say I do.But I am happy to continue working unless I became so filthy rich, I'd have to tell myself why work.Don't know if I'd want that though.

[StockBeard]

My loan will end when I'm 73. I certainly hope I will have retired long before I do my last payment.
Rationale: Given the interest rates, this is as close as it gets to free money, so I feel like repaying it too fast is not the right move.

[concerned]

I have a loan till I am 80
Bought second hand house, for 26 M
Have half the loan flexible at 0.5 % and half fixed at 1.5%
Planning on keeping the loan till term, just see it as paying rent, without the hassles of renting...

[jcc]

I'd say they can't, or are delusional about it, or have two salaries (i.e household income between 10 to 14 million yen). 1) House ownership has been regularly pointed out as a huge destructor of wealth in Japan (see https://www.scribd.com/document/237374520/Np-20081I37 ).

I'm reading through this, some things that really bother me that they do discuss, but keep out of the numbers are:

- They mention the significantly higher (5+ times!) maintenance costs of old homes
- They mention the money spent on updating homes with new kitchens and the like to retain their values.

They then compare these refurbished old homes to 15 year old japanese homes that have had very few maintenance costs, without actually talking about the cost of ownership(which most car owners are acutely aware of).

Where can we get some real comparisons on these factors?

Recently also construction standards have improved a lot. The houses we have now that were build in japan 30 years ago are kind of crap. But most homes built in the last 15 years are pretty nice, the only issue is with how well they've been maintained. Could Japan be coming to a turning point here? I remembering reading an interview with an architect that moved to japan that says the construction here is pretty cutting edge because the market is so active.

What gives? (btw that report is also 11 years old so maybe out of date a bit?)

[StockBeard]

Anecdotally, independently of the quality of the houses, I feel that there is not much demand for "second hand" houses. So even if they are of good quality, they drop in value. You might be right that we could be at a turning point, but with the shrinking population we have another ingredient in the mix that could simply mean the market will shrink no matter what, so the houses won't retain value?

Slightly more recent, there was a freakonomics podcast on the topic. I listened to it a while ago so I don't remember clearly, but I don't think it brings you the comparison data you want:
http://freakonomics.com/podcast/why-are ... podcast-3/

[eagleyes]

Thank you to all for your valuable inputs.
Let me continue the discussion:
- Most of you guys do not consider paying back the loan in advance. This is because the interest rates are very low right now. I agree with that. However, I would like to check with you the loan conditions. Is it written in your loan conditions that you can repay in advance? Are there any fees associated with that?

- Coming back to the variable rates, aren’t you afraid that the variable rates increase in the future? Now they are so low but it means that they can only go into one direction. Up. Then, you total loan could be very expensive. Maybe you cannot afford to pay back. Or do you consider that in Japan, the rates will remain very low for a very long period of time?