Your home a bad investment?

[Bigritchie]

I personally do not consider my home a "asset" due to it being a money drain and all the bills it produces. Maintenance & Upkeep, taxes, utility bills etc etc. Not to mention if you paid for 400,000 over 30 years for a house that cost 200,000. I think the general public think that since that house cost them 200,000 at closing 30 years ago, and they sold it for 300,000 they made a nice proffit. When in reality they lost 100k just off the interest, not counting buying lawn mowers/maintenance etc etc.

I personally consider my home a liability, or maybe a chip to exchange for another chip wherever I want to live.

I am not saying that you cannot make money buying or selling houses or anything like that, as many people have done just that.

I am just saying for the house I live in now, it gives me negative cash flow, and not positive cash flow.

Anyways just my 2 cents.

[kcowan]

Quote:

Originally Posted by cute fuzzy bunny ...do it and bank your tax free profits.

The fact that CGs can be rolled over into another home is definitely an advantage. Although it also works against owners considering cheaper rental alternatives, especially when it comes time to downsize in retirement.

Avoiding taxes is almost as strong an emotional driver as home ownership. It can drive people to do irrational things.

[cute fuzzy bunny]

I never thought that making money was irrational.

The CG rollover rules went out the window 10 years ago. Now if you've lived in the home as a primary residence for 2 of the last 5 years to qualify for a tax free gain of up to $500,000.

I could watch my current home double in value, sell it tax free, and go live in a hut. No problems with downsizing under the new tax rules.

If I make more than a half mil in profit selling my primary residence, I'll be pretty frickin pleased to write a little check to the feds

[Lakedog]

Quote:

Originally Posted by cute fuzzy bunny I never thought that making money was irrational. The CG rollover rules went out the window 10 years ago. Now if you've lived in the home as a primary residence for 2 of the last 5 years to qualify for a tax free gain of up to $500,000. I could watch my current home double in value, sell it tax free, and go live in a hut. No problems with downsizing under the new tax rules. If I make more than a half mil in profit selling my primary residence, I'll be pretty frickin pleased to write a little check to the feds

Makes perfect sense to me -- I always look at a residence this way as well, it can be both a home and an investment. Been in my current lake house almost ten years, paid $150K, currently valued at $600K. I will retire in September and am thinking about selling to relocate (and bank some equity).