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A house is a liability. Land is an asset
by progre 7y ago
A house is a liability. Land is an asset
- taneq 7y agoPrecisely. Houses depreciate, the land they're built on (typically) appreciates.
- ben_w 7y agoYes, though the buildings on the land can be a multiplier that makes up for the cost. I own the leasehold of a flat, and I’m collecting more rent than the freeholder (landholders? I forget the terminology) of the land it’s on is collecting from me as ground rent.
- taneq 7y agoOh sure, but you have to pay for upkeep. I can rent out a car, that doesn't make it an appreciating asset.
- newnewpdro 7y agoThere's substantial value in a legally constructed, code complying, permitted residence. Especially in areas where development is costly and/or frequently difficult to impossible like desirable parts of CA.
- danhak 7y agoNah, a house is an asset. A depreciating asset but an asset nonetheless. Depreciating asset !== liability.
- tonyedgecombe 7y agoIt can be both, an asset because it is a store of value, a liability because you need to maintain it.
- heyflyguy 7y agoI totally agree with you, unless the house is a rental.