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Plus - housing is fairly secured and unlikely to ever go to zero, it's tied to an asset, and you can invest on loaned principal without extreme risk in case of
by yitianjian 8y ago
Plus - housing is fairly secured and unlikely to ever go to zero, it's tied to an asset, and you can invest on loaned principal without extreme risk in case of failure.
- inscionent 8y agoGoing to zero has zero to do with real estate being a secure investment. Owning an underwater property and running into a situation where the investor can't continue to make the mortgage payments is just as bad as the asset going to zero for most. > you can invest on loaned principal without extreme risk in case of failure Yes, when this happens thousands upon thousands of times you have the 2008 world wide financial crisis.
- TuringNYC 8y agoAssuming you purchased your house with 20% down and 80% mortgage (which is very common), housing only has to go down 20% for you to "go to zero." Further, unlike stocks, buying/selling houses incurs fees (round-trip fees can be anywhere from 5% to 12% depending on your city/state/country), so really, a house going down 15% is like you going to zero.