4 ms·
If you buy a house worth 4x your salary (in the ballpark of average), a 25% decline in home value means you need to spend an entire year of labor just to break
by klmadfejno 6y ago
If you buy a house worth 4x your salary (in the ballpark of average), a 25% decline in home value means you need to spend an entire year of labor just to break even, ignoring the obvious associated living costs. The decline doesn't matter if it's temporary, but they're not always temporary.
That sounds incredibly demoralizing.
- xenonite 6y agoOn the other hand, renting an apartment translates to a 100% decline in value (and 0% ownership).
- klmadfejno 6y agoRenting is not a leveraged loan worth multiple times your annual income. Home ownership may generally be better than renting. But home ownership and value decline is much much worse.