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Viewing home as an asset, home as an investment, purchasing home as investment, home as an investment debate, home is not an investment it is a consumer good
I find it funny when those who have paid off their homes, don't have a home, or are not in risk of being underwater laugh it off and tell people that homes ARE not an investment and that people are stupid for even looking at homes as an investment.
So, why do you buy a home? So that you can own capital that will pay you dividends when you get older. What are the dividends? It's not having to pay RENT for shelter when you finally finish paying for a home.
"Not having to pay RENT" is not a dividend. Buying a home is one way to acquire something that is generally regarded as essential -- a place to live. The fact that it may be cheaper than acquiring the same thing in some other way (renting) does not make it an investment.
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All the fluff of owning a property to live in, etc... ultimately means not having to pay rent in the future.
Otherwise, why even bother with home ownership?
That's a perfectly reasonable argument for home ownership, but it doesn't make the home an "investment". It might make it an optimal way to acquire shelter.
How about this... a home that you "live" in is not a financial investment since its almost always a losing investment.... but a house (that you don't live in) that you buy and sell fast is a financial investment since the returns are good if you can sell it fast and for a profit...
How about this... a home that you "live" in is not a financial investment since its almost always a losing investment.... but a house (that you don't live in) that you buy and sell fast is a financial investment since the returns are good if you can sell it fast and for a profit...
a financial investment can be a "losing" investment.
People have lived in homes for a long time, paid off the mortgage, sell it for way more than they bought it for, and downsized....
this happens all the time.
However, I think people assume "returns" on a home are larger than they really are (thanks to the NAR).
I consume corn flakes, hamburgers and a cold beer from time to time.
I do not consume my home. I have too much INVESTED in it.
Is that supposed to be a serious economic argument, or are you trying to be funny ?
You don't consume your home because it is a durable good. Whether or not a good is durable has nothing to do with whether or not it's an investment. Some investments are non-durable (such as commodity futures positions) and some durable good are not investments, even if you think that you "have too much invested" in them (e.g. a wedding ring).
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