Tag: dcf

• Compute Discounted Cash Flow for Buying a House as Investment (20 Mar 2021)
  

  In this post, I apply DCF to evaluate whether it is a good idea to buy a house as investment. Here I use the numbers for a typical townhouse in bay area. Based on my analysis here, it may not be a good investment to buy a house for rent in Bay area–it could take more than 40 years to pay back your investment from rent, if doesn’t consider the value of selling house at the end of investment period. This could be even worse, if you could not use mortgage when buying the house.