Do you own your home? Do you wish you did?

Janderso

Janderso

Jeff Anderson
H-M Platinum Supporter
Joined
Mar 26, 2018
Messages
8,407
I'm asking the question because of the financial benefits that can be had buy investing $500,000 rather than putting it into your property.
I've heard rich people don't own anything. They let the banks own assets to keep the cash invested in securities, funds, business ventures etc.

Without getting personal, I'm asking if you would rather make money on funds that you could put into a home.
We love not having a mortgage but I can't shake the fact that we could double (if properly invested) every 5-7 years.
On the other hand, real estate has done very well but the only way you can have access to the money is by selling the home or by taking out a mortgage.

Tough decisions.
Thanks for your opinions.
 
People I know are remortgaging their paid for house and investing in dividend paying stocks which will cover the payments and more, plus capital growth over the long term. Wish I had done this 20 years ago.
Pierre
 
Mortgages are cheap. About the cheapest money you can get. Take some inflation into account and (at the current crazy low interest rate), it's almost free. For what it's worth, the FIRE movement misses this completely, and to it's own detriment.
I just bought myself, got a 5 year fixed deal that I think (hope) should be long enough to ride out the crazy times ahead.
Things on my mind for the next few years (I'm assuming a moderate to high level of inflation):

Cash is a bad investment during times of high inflation. It's value decreases as it sits under your mattress
Debt, assuming a low, fixed rate, can be good. The real value of the debt decreases just the same as cash, but in your favour.

It's discussed here in brilliant detail, and I think answers almost what you're looking for.


In short: get a good mortgage, invest the rest wisely. Putting down a decent deposit so you get good loan to value ratio will get you a good rate.

Just the humble opinion of a random guy on the internet, of course!
Another key thing for me is I'm not at the mercy of a landlord that might decided they want to sell the property out from under me or raise the rent sky high, forcing me to move my shop (again). Take a look at Tom Lipton on YouTube lately... The mortgage is the lesser of two evils there too!
 
I do own my home. Only thing I owe the bank is a credit card that gets paid off every month.
I also manage my retirement portfolio, and have done quite well in the last few years since rolling it all out of the company plan. Frankly, better than working on a yearly basis. But that can easily change.

The problem with mortgaging the house to cover investments, is that the mortgage/rent is still due even if the market tanks. And the market will tank at some point, not that it won't recover again. But if it tanks and you have to pull money out to pay the mortgage/rent, that money is hard to win back. And it is VERY difficult to ride out a downturn, instinctively you want to pull it out as cash.

On the other hand if the house loses 1/2 it's value, it's still the same home. No lose of utility to me.
 
Houses and property are REAL investments . I've rented my little rancher out for 28 years . I've made money on it and I still own it . My original investment of 71K is now valued at close to 300K . I own my now house outright also . I don't view it as an investment but rather a place to sleep but the value since owning is up 300% . Still , I don't view either house as investments . I own 45 acres up in the Adirondacks . Paid in full . Taxes are steep , but worth the effort needed for my outdoor therapy . I keep money in liquid cash accounts for dry powder to add the my S&P accounts if and when they tank . If the entire market crashes , I still have the land and both houses , with additional cash to add to the stock funds . Don't know if this answered your question Jeff , but my answer would be to stay diversified as we don't know what the future holds .

When I say liquid assets . I have a liquid account that gets 5-8 % every year . I have accounts that get $hit yearly . It's all play money but it is my cushion .
 
I own my own home. We decided to buy a small house, rather than be home rich and cash poor.
I paid for my sons college because of that. I told him when he was young, you get the grades and I'll pay for college.
I didn't know how high college would be. But I kept my promise.

We paid off our mortgage in I think 2016...
I don't have to worry about mortgage , rent ... just paying taxes (which are lower because of the size of the house), food, auto expenses, health insurance and expenses. Everything else is gravy.
 
You must log in or register to reply here.
Back
Top