Nikhil Kamath, the co-founder of India's largest discount broker Zerodha
Nikhil Kamath, the co-founder of India's largest discount broker, Zerodha, recently bought a house, a decision that has left many surprised. In the past, he had dismissed the idea of homeownership and cited the advantages of renting.
During a recent episode of his podcast WTF, the 37-year-old entrepreneur made this revelation in a dialogue with industry leaders, including Irfan Razack, chairman & managing director of Prestige Group, Nirupa Shankar, executive director at Brigade Group, and Karan Virwani, CEO of WeWork India. During the session, he reignited the long-standing debate between buying and renting property.
Nikhil Kamath, known for his strong stance on renting, acknowledged a significant drawback of this approach. “Of all the advantages of renting, there is one disadvantage, that you don't have foresight as to when you can move out of the house. Like, I had to move out of this house, whereas I may have liked to stay longer in this house. Not having the nuisance value of having to move, felt like it made sense to buy one,” he said.
When asked about the potential benefits of buying a property, including financial strength and security of an individual, Mr Kamath expressed his disdain for the “illiquid nature of real estate.” He said, “I feel something like gold can give that to me. I hate the illiquid nature of real estate.” Talking about his apartment, he said, “Places like this have fewer buyers. So, the pricing is like if 10 people here decide to sell, then everything is haywire, and the pricing is very arbitrary in nature.”
Comparing this with the stock market, Nikhil Kamath said, “The stock market has more people. If in a certain company, one million people decide to sell, then it makes a significant difference."
Mr Kamath also expressed his opinion on stamp duty imposed on property transactions, pointing out that, “In the stock market, I can buy and sell without paying 5% to 6% stamp duty.”
The discussion also touched upon the profitability of buying a property to rent out versus Airbnb. Kamath stated, “I think nobody makes money from buying and renting a place,” adding that with Airbnb's “You do not have occupancy throughout the year.”
The discussion also explored the profitability of buying a property to rent out compared to using it as an Airbnb. Nikhil Kamath remarked, “I think nobody makes money from buying and renting a place,” further explaining that with Airbnb, “you do not have occupancy throughout the year.”
People reacted to the news with comments such as “If you're wealthy, buying a home or renting literally does not matter!!”
A user wrote, “Wow, finfluencers have finally realised something so obvious.”
Highlighting the stability and security behind owning a house, another said, “Owning a house gives a sense of security and stability to the entire family. Apna ghar kaisa bhi ho, apna ghar, apna ghar hota hai (No matter how your home is, a home is still a home). And that feeling cannot be compared to any value of money.”
According to Forbes, Nikhil Kamath has a net worth of $3.1 billion and is ranked 1,135th in the world as of October 19, 2024.