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Housing is consumption, it shouldn't be considered an asset. It doesn't produce anything.
by missedthecue 5y ago
Housing is consumption, it shouldn't be considered an asset. It doesn't produce anything.
- throw0101a 5y agoHousing / shelter is considered in the CPI, including wear and tear on the structure. But the largest component of any "house" is actually the land, which is an asset and thus not in the CPI.
- dragonwriter 5y ago> Housing is consumption Shelter is consumption, housing is an asset. > It doesn't produce anything. Housing produces shelter over time.
- missedthecue 5y agoFood produces nourishment over time... it's not an asset.
- dragonwriter 5y ago> Food produces nourishment over time No, it doesn't. Agricultural real estate does, and it is an asset.
- missedthecue 5y agoThat's like saying homes don't provide shelter, construction companies do. Either way, you've run yourself into a contradiction here.
- dllthomas 5y agoSome company builds machines that make buttons. One of those machines lasts (say) 20 years. The machine is not buttons; the machine provides buttons. The company sort of provides buttons, but at one step removed. We say that machine is an asset. The machine is eventually "used up" over its lifetime, but that doesn't make it "consumable" in the sense used here - that's true of many assets (we call it "depreciation"). I think "house as button machine" is a consistent model that matches dragonwriter's usage.
- dragonwriter 5y ago> That's like saying homes don't provide shelter, construction companies do. No, it's not. Food isn't a durable good that provides “nourishment” for consumption on an ongoing basis; agricultural real estate is, in exactly the same way as residential real estate is for shelter.