4 ms·

If you own a home, and it goes up in "value" 50%, and then back down without you ever selling, does that mean you "lost" that 50%?

• 10u152 3y ago
  Of course not, it's just a good headline. Only if you bought or sold or used them for leverage.
• onion2k 3y ago
  Yes. Its more obvious with something tangible. If I give you a $100 bill, and then you drop it down a drain, have you lost it? Of course you have. The same is true for the value of assets though. You had the opportunity to cash it in by selling, you could have secured a loan against the value, you had the status of the wealth of owning a more expensive home. Those things have real implications on your life, and now you don't have them. It doesn't really matter that it's not actual cash.
  • birken 3y ago
    You always need somewhere to live, so you can only "sell high" if that means you can "buy low" somewhere else. If all bay area houses go up 10%, then you haven't actually gained anything assuming you still want to live in the bay area. You also lose at least 5-6% of the value of real estate every time you buy or sell. So given that buying/selling real estate is complicated and expensive, and moving is complicated and expensive, for the vast majority of people, the value of the house going up and down _in the short term_ is mostly irrelevant.
  • gleenn 3y ago
    I still have this hard feeling that the never-ending cycle of increasing home value isn't fed by an over-zealous US house pricing phenomenon. There is definitely scarcity, but why does housing fundamentally increase in value so dramatically over relatively small periods when nothing fundamentally changed of the property.