Posted on 08/25/2005 11:56:51 AM PDT by hubbubhubbub
Housing will appreciate 10,15,20% a year, year in and year out- forever. Don't ever expect a correction. In just ten years the AVERAGE house will be well over $400,000, pricing completely out the average worker, which is a good thing in the long run for the invester class.
Buy a house if you can, actually buy 1,2,3 as many as you can!
I sold my house a year ago and netted $300,000. Half of it went to a downpayment on my new house and I used some to pay off credit cards and buy furniture. I still have over $80,000 in the bank. Why is that not savings? My new house has appreciated by almost $100,000 in a year. I could borrow against it and afford the payments based on my income. Why is that not savings? (BTW, I also have sizable retirement accounts and college savings plans for both my kids.)
Yes, but...
I agree with you. And congratulations on all that savings.
I bought a nice home 7 years ago. Now I could not get up enough money for a down payment on it. Twenty percent down would be $58,000.
I like what has happened. It allows me to get low interest loans and then pay them off.
I see so what you are saying is joe 6-pack is just out of luck in the home ownership game, if you can't afford just rent. umm sounds like the early 20th century before the big crash
Many who read your post won't realize that you left out the "/sarcasam" tag.
Every house I bought, I made money when I sold it. Once in a while it was a shocking profit. I have only lost money when buying stocks. I am not real smart in that department. LOL
Nah, he's making too much money posing as an economist. Let's get together on definitions-- here's a good Wikipedia discussion of savings in economics terms:
| In economics, personal saving has been defined as personal disposable income minus personal consumption expenditure. In other words, income that is not consumed by immediately buying goods and services is saved. There is some disagreement about what counts as saving. For example, the part of a person's income that is spent on mortgage repayments is not spent on present consumption and is therefore saving by the above definition, even though people do not always think of repaying a loan as saving. However, in the U.S. measurement of the numbers behind its gross national product (i.e., the National Income and Product Accounts), personal interest payments are not treated as "saving" unless the institutions and people who receive them save them. |
Schiff was going way off line by saying that it ain't savings unless it "adds to society‘s stock of savings". He's a Democrat; he believes that all wealth belongs to the state.
On the other hand, I'll agree that home equity is not savings but for a different reason. It's because we buy houses so we can have a roof, and we open bank accounts so we can have money. If we say our house is our savings because we can sell it if we need the money, then that let's us say our car is savings-- our new snowmobile is savings-- and my really neat game cube is savings. Pretty soon we'll start hearing politicians saying that they want to raise our taxes so they can 'invest' in new government programs. We don't want that to happen do we?
Who?
It reveals alot, doesn't it?
This will change at some point, but we'll be stuck w/a whole semi-generation who reached maturity w/o developing the habit of saving.
Home Equity is not savings. It can only be spent if you borrow against it or sell your house and buy a cheaper house.
If you borrow against your home you still owe the money back. How is that savings?
I can kind of see what this author is trying to say, but I question his pious attitude about what constitutes "legitimate" savings.
No "real" investments represent purchasing power until they are liquidated. Money-market savings? Inflation could wipe out any gains. Stock market? A downturn could lose equity. Gold or other commodities? Same thing there.
I think that what the author wants to say is that homeowners should not fool themselves into thinking their real estate is worth more ten years from now than it's worth presently. Those same homeowners should not kid themselves into think they are required to save less, simply because the present value of their home has more market worth than intrinsic value.
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