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but it's relevant when you're trying to convince someone "well at least you still have a house" after the market crashes and the bank kicks them out because th

• XorNot 5y ago
  No one loses their house because the market crashes, they lose their house if interest rates are raised heavily and they have a variable rate mortgage, or if the subsequent economic turmoil wipes out their job. This line of discussion has got a lot of weird perceptions on what a housing crash actually means. But unless you're holding investment property, then you can't lose your house in a crash without somthing else happening (and in 2008 plenty of people just defaulted on their loans, then rebought their houses at the true market value and ate the credit rating problem as the better option). That's not to say their aren't significant follow on effects, but to reiterate the core point: it's not a Ponzi scheme if you own as a result of the transaction a physical product with utility (and plenty of people do in fact own their house's outright: no housing crash will make the title deed be magically not yours, the corruption and incompetence of the US banking and court system notwithstanding - again see foreclosures in 2008).