Er bolig bedre end pensionsopsparing?

Abstract

The purpose of this paper is to conclude whether the investment in the housing market is better than putting the same amount of money into a pension fund and investing that money in exchange traded assets. In this paper one can see a regression analysis being made to create the foundation for a forecast for prices of apartments in Denmark. The forecast is based on future estimates – the very same estimates that are part of the beforementioned regression analysis. Besides the forecast, the analysis is based on two different apartments in Denmark, which rents are based on two different principles: the free rent and the value of the rented. The apartments will be rented out in the measured period, and the increasement of the housing prices and the cash flow from the rental will be the return of the apartments as an investment. As a basis of comparison, this paper will make a portfolio based on 100% stocks and an alternative portfolio, which will decrease the risk of the portfolio over time. Both portfolios are based in pension savings accounts. The return and the standard deviation are based on the Council of Expectations for return and their latest report of expected returns and standard deviations in the future. The conclusion will be that the portfolio of 100% stocks will outperform the apartments. But very few people will invest their pension savings in 100% stocks, which is why the other two alternatives are more likely. The investment of the best apartment will outperform the alternative portfolio in pension savings accounts before tax, but after tax the pensions savings makes the best return. The overall conclusion of this paper could be increased if the calculation considered that rentals have the risk of no rent, maintenance etc. Besides that, an interesting perspective could be two provincial houses with the same two principles of rent and compare the return of the apartments. Finally, the regression analysis could be more descriptive if the analysis included more variables from the other quadrants of the Housing Economics Basic Model.