<i>"does everyone not realize that real estate can and does go down?"</i> Just like stock index markets?
I agree. Sold my house in Park City, UT a long time ago, and have been a full time nomad ever since. I am single so its easy. I only need a good net connection. Since the switch to no house (and often no apartment either in 3rd World countries), I have lived in Hood River, OR (resort town), SF, Finland, Dominican Republic, Brazil, Singapore, and Thailand. Often living in hotels long term. Ultimate freedom. Now in South Padre Island, TX, and soon moving to San Diego. I plan to stay there awhile however. I think... Its a freedom/ lack of hassle thing. Besides, you won't see a good return in real estate again anytime soon. The income/mortgage ratios are WAY out of whack. We will need to have flat prices for years, or a rise in incomes to match historical ratios. Its inevitable because those crazy new wave loans are going bye bye! Homes can't keep ratching up if no one can afford them. Jay
agreed... best thing I ever did was sell my house in NYC and rent all over the USA.... the freedom and stress free life this allows is awesome
That's where I disagree. A home is for living. It is not for asset appreciation. If you want to buy real estate for that purpose, fine, but don't feel compelled to live in it. That creates emotional attachment and is a no-no. Once you have an expensive home, you have a need to keep up with your expensive neighbors, furnish your 6000 square feet and pay your increased taxes. You also have less liquidity as there are simply less people able to buy your home (law of averages, you know?) Buy a less expensive home, and you need not live like a millionaire. But you might end up one, as you're not paying everything towards a mortgage in the hopes of continued inflation causing false asset appreciation. That extra cash sure goes a long way towards paying down that mortgage quickly. My mtg, insurance, and taxes are about 13% of my monthly nut, and I like it that way.
Not if you live in the right locations. My last 3 sales I made 50% (in 6 years) in 1999, 160% in 2004 and currently am sitting on a nice gain in my current house. Those gains totalled about $300,000 that were 100% tax free. And the above amounts take into account mortgage payments over the time I owned the houses. The $250K (single) $500K (married) exclusions make owning real estate so much more desirable than flushing rent down the toilet each month.
I own my house. I like to tax right off and appreciation aspect. When you rent your paying the other guys mortgage and he gets all the benefits. Owning allows you to build equity. Can't do that with renting.
I'm a happy home owner. I can't imagine not owning a home unless you're single and like to jump around.