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How illiquid is it given the widespread availability of HELOCs?
by bradleyjg 6y ago
How illiquid is it given the widespread availability of HELOCs?
- OldTimeCoffee 6y agoA house can't be sold readily. Even if you get in contract ASAP, it's usually 30 days until closing. It's illiquid because 30 days isn't 'readily'. To contrast this with something 'liquid', with a stock you can sell and wire the funds same day if you needed to, 2-3 days if you use ACH instead. HELOC is a loan and doesn't have anything to do with how liquid the asset is.
- deleted 6y ago[deleted]
- readflaggedcomm 6y agoCredit has little to do with convertability.
- bradleyjg 6y agoWhy not? The argument is that someone sitting on a $2 million house isn’t “really” rich and shouldn’t have to pay taxes on their house. But they are “really” rich and can easily access that wealth. They’d just prefer not to.
- readflaggedcomm 6y agoI don't remember that argument in the article. It talked about race, not what assets imply.
- OldTimeCoffee 6y ago"But they are “really” rich and can easily access that wealth. They’d just prefer not to." Banks have lending limits. You're assuming the $2mm house isn't leveraged to begin with.
- bradleyjg 6y agoIf the house was worth $2 million when the owner bought it then they are rich or they’d have never gotten a mortgage. If they are fully leveraged because they’ve already pulled all the equity out—-well where’s that money? I’m sure you can find some obscure edge case somewhere but by and large people that own things that are worth a lot of money are rich and don’t especially need our sympathy. Let’s save that for all the actual poor people out there that don’t own houses, much less multi-million dollar houses.