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How is higher net worth a benefit? Gains in a property are unrealized until sold or mortgaged.

BugsJustFindMe 3y ago
> How is higher net worth a benefit? The benefit comes from gains being definitively accumulated by percentage. When your owned amount is higher, equal percent gain is greater absolute gain. > Gains are locked into a property until sold or mortgaged. This is essentially the equivalent of "Gains are locked into money until spent on goods or services." True. But gains are gains and worth is worth regardless of how many seconds or minutes it takes to spend. The only difference is immediate urgency of conversion within a very narrow time window (it does not take that long to get a mortgage on an owned property that is now worth X percent more than it was yesteryear).
- gspencley 3y ago
  To an accountant you might have a point. To me, if it doesn't have a direct and measurable impact on my quality of life then it's a completely irrelevant factor. Maybe "profit" was a poor choice of words. But this has turned into an utterly meaningless semantic argument that has nothing to do with the point I was trying to make.
  - rcme 3y ago
    Is feeling secure in retirement not a relevant factor? Is having wealth to do things, even if you don’t exercise that wealth, a completely irrelevant factor? Is leaving generational wealth for your children irrelevant? Let’s say you had to forfeit the houses for some reason (being sued, for example). According to you, owning the houses is an completely irrelevant factor, so I’m safe to assume you would feel totally indifferent to this happening? Somehow, I find it hard to believe that you wouldn’t care about losing your houses. Perhaps it does have some relevance to your life?
    - positr0n 3y ago
      > According to you, owning the houses is an completely irrelevant factor No, they're saying the price of the house is irrelevant. If they bought both houses for $250k, say they're now worth $750k, they're a millionaire and got a million dollars of profit! Their point is they need two houses for their family and will until they die. If they have two houses still worth $250k or two houses worth $750k it doesn't matter to their quality of life.
      - dragonwriter 3y ago
        This would be true if we lived in a society where value of assetsd you own has no impact on access to and cost of financing, and other advantages, that can be realized without sacrificing the assets, but that is very much not the world we actually live in.
      - deleted 3y ago
        [deleted]
      - rcme 3y ago
        Price is just a proxy for value so there isn’t much of a functional difference between the price being $0 and not having the object.
  - BugsJustFindMe 3y ago
    > To me, if it doesn't have a direct and measurable impact on my quality of life then it's a completely irrelevant factor. If having more money available to you through conversion doesn't have a direct and measurable impact on your quality of life, that's exclusively because of decisions you make about what to do with it. Assets don't follow you into the afterlife, so, bare minimum, when you get old you can sell it and rent or put a mortgage on it and have a much bigger pile of cash to spend until you die than the person with the less valuable house would. Or, if you have children and are into such things, you can engage in massive generational wealth transfer and make it so they never have to work a day in their lives to cover rent. There are a lot of people out there who don't get to experience such a wondrous bounty that they didn't do anything to earn but which is an extremely relevant benefit with extremely measurable impacts on quality of life nonetheless.
deleted 3y ago
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antisthenes 3y ago
So sell the extra property and enjoy the money? The benefit is having that option.

> How is higher net worth a benefit? The benefit comes from gains being definitively accumulated by percentage. When your owned amount is higher, equal percent gain is greater absolute gain. > Gains are locked into a property until sold or mortgaged. This is essentially the equivalent of "Gains are locked into money until spent on goods or services." True. But gains are gains and worth is worth regardless of how many seconds or minutes it takes to spend. The only difference is immediate urgency of conversion within a very narrow time window (it does not take that long to get a mortgage on an owned property that is now worth X percent more than it was yesteryear).

gspencley 3y ago
To an accountant you might have a point. To me, if it doesn't have a direct and measurable impact on my quality of life then it's a completely irrelevant factor. Maybe "profit" was a poor choice of words. But this has turned into an utterly meaningless semantic argument that has nothing to do with the point I was trying to make.
- rcme 3y ago
  Is feeling secure in retirement not a relevant factor? Is having wealth to do things, even if you don’t exercise that wealth, a completely irrelevant factor? Is leaving generational wealth for your children irrelevant? Let’s say you had to forfeit the houses for some reason (being sued, for example). According to you, owning the houses is an completely irrelevant factor, so I’m safe to assume you would feel totally indifferent to this happening? Somehow, I find it hard to believe that you wouldn’t care about losing your houses. Perhaps it does have some relevance to your life?
  - positr0n 3y ago
    > According to you, owning the houses is an completely irrelevant factor No, they're saying the price of the house is irrelevant. If they bought both houses for $250k, say they're now worth $750k, they're a millionaire and got a million dollars of profit! Their point is they need two houses for their family and will until they die. If they have two houses still worth $250k or two houses worth $750k it doesn't matter to their quality of life.
    - dragonwriter 3y ago
      This would be true if we lived in a society where value of assetsd you own has no impact on access to and cost of financing, and other advantages, that can be realized without sacrificing the assets, but that is very much not the world we actually live in.
    - deleted 3y ago
      [deleted]
    - rcme 3y ago
      Price is just a proxy for value so there isn’t much of a functional difference between the price being $0 and not having the object.
- BugsJustFindMe 3y ago
  > To me, if it doesn't have a direct and measurable impact on my quality of life then it's a completely irrelevant factor. If having more money available to you through conversion doesn't have a direct and measurable impact on your quality of life, that's exclusively because of decisions you make about what to do with it. Assets don't follow you into the afterlife, so, bare minimum, when you get old you can sell it and rent or put a mortgage on it and have a much bigger pile of cash to spend until you die than the person with the less valuable house would. Or, if you have children and are into such things, you can engage in massive generational wealth transfer and make it so they never have to work a day in their lives to cover rent. There are a lot of people out there who don't get to experience such a wondrous bounty that they didn't do anything to earn but which is an extremely relevant benefit with extremely measurable impacts on quality of life nonetheless.

deleted 3y ago

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antisthenes 3y ago

So sell the extra property and enjoy the money? The benefit is having that option.