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I seem to have been unclear, when I said "houses are depreciating assets" I meant the structure itself. This is almost always true. However, the land it is on
by ska 8y ago
I seem to have been unclear, when I said "houses are depreciating assets" I meant the structure itself. This is almost always true.
However, the land it is on may well be rising in value enough to counteract the depreciation - so your house + land may well be worth more in 10 years, even though the house itself is probably worth less.
Make more sense?
- quickthrower2 8y agoThere are three things at play: 1. Value of land 2. Value of building in perfect order 3. Lost of value of building due to wear/tear etc. If building/trades costs are rising #2 can rise too while #3 will counteract it, and it depends how much money is put into maintenance and renovations. Notwithstanding cultural issues with old houses.
- ska 8y agoSee the "almost" in "almost always". You can reduce the depreciation of a depreciating asset by putting money into it, sure, but that doesn't counter the point. I agree there may be some weird inversions due to a spike in labor and/or material costs - but you wouldn't want to bet on it. The usual case is they are just losing value, and requiring injections of cash periodically.