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Buying a home


Forum: Financial Planning and Budgeting

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  #1  
July 26th, 2011, 09:18 PM
JessP's Avatar Lovin life and family
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Do you see buying a home as an investment or not?
Why or why not?
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  #2  
July 27th, 2011, 12:07 PM
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I used to, but we bought before the market crash.

For some people it can be an investment, but a very long term one. Case in point - my parents' bought a house in 1968 for 18K. Even in this horrid market, they could sell it, as is with the minimal stuff they've done (mainly upkeep), for close to 800K.

Our house has been a money pit and our local market sucks. So we're not seeing any return like that, even in 40+ years.

I like the idea of owning because you have control and over time it CAN be an investment, but like all investments, there's a risk of loss.
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  #3  
July 29th, 2011, 10:55 PM
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Depends. My home was supposed to be an investment (one we'd live in, but still an investment), and now we're $185K upside down.

Now if you buy NOW and wait for the market to improve it will absolutely be an investment.
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  #4  
July 30th, 2011, 02:01 AM
Happy Song's Avatar Nicole
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Mine is an investment even though it is depriciating like everyone else. But the difference is there is no morgage and thus no interest. We would still need a place to live. So let us say it was $500/month or $6k per year even dropping in value from $70 to $52K (per zillow versus Spokeo valuing it at $64,500) We have lived her five years so there is $30K in rent/housing we did not to pay.

At this point I would not get a morgage unless I could pay a heafty down payment.
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  #5  
July 30th, 2011, 04:35 PM
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We put a nice down payment down on our house. For us it is definitely an investment. In our area, even if we move the house would be a rental unit. But we love the house and I dont regret the buying!

However if they take away the interest tax credit, we will finish paying off our house.
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  #6  
July 30th, 2011, 04:37 PM
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Quote:
Originally Posted by hkystar View Post
We put a nice down payment down on our house. For us it is definitely an investment. In our area, even if we move the house would be a rental unit. But we love the house and I dont regret the buying!

However if they take away the interest tax credit, we will finish paying off our house.
You're better paying it off anyway. You will save more not having the payment than you do in the tax credit just an FYI.
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  #7  
August 1st, 2011, 09:39 AM
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Sure it is! An investment is something that has the potential to turn a profit. A lot of things won't in the long run, but that doesn't mean it didn't have the potential to do so.

In our current housing market, most people who have bought in the last 15-20 years are not seeing a profit if they tried to sell today. But in that 15-20 years, there was most likely some point in time that they could have made a profit if they sold.

This Sept will mark 10 years of being in our home. At the highest point, we probably could have sold for about $50K over what we paid, but now at a fairly low point, we'd get about $30K under what we paid.
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  #8  
August 19th, 2011, 02:00 AM
JessP's Avatar Lovin life and family
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Kris that isn't to bad really in this market. Not that anyone wants to lose money but I know for us we are about $100K upside down and it stinks. Luckily we don't have plans or a need to move anytime soon.

I do know some people are letting their houses go (foreclosure) because they see it as a bad investment and they want to wash their hands of it. Hence why I wondered about homes being an investment.
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  #9  
August 19th, 2011, 03:31 AM
Happy Song's Avatar Nicole
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Does anyone remember the 1980's? The interest rates where extremely high, Between 17% and 20%.
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