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> You're completely ignoring equity. You're assuming equity is guaranteed. If you buy a house at $X, and it adjusts to $X/2 because of speculation or job loss

by cbd1984 12y ago

> You're completely ignoring equity. You're assuming equity is guaranteed. If you buy a house at $X, and it adjusts to $X/2 because of speculation or job losses in the area, you're still paying down the $X + $Y mortgage, where $Y is interest, fees, and whatever else the bank tacks on, now or in the future, and have no way to recoup your losses. And you still have to pay property tax, based on the assessed value of your property circa pre-collapse.

twblalock 12y ago
I know people who had their homes re-assessed in 2009-2010 and their property taxes decreased significantly from the pre-collapse amount.
djrogers 12y ago
> If you buy a house at $X, and it adjusts to $X/2 because of speculation or job losses in the area, Historically that is almost unprecedented - and no, a few thousand homes in a couple of areas does not make it any better an argument. Over time, property values go up - it's not a theory, it's a fact. >you're still paying down the $X + $Y mortgage, where $Y is interest, fees, and whatever else the bank tacks on, now or in the future The bank can't 'tack on' arbitrary 'fees, and whatever' in the future on any decent mortgage - in fact I've never seen a residential mortgage that allowed that. If you don't get a fixed rate mortgage then your rates may rise, but that's an argument against variable rate mortgages, not home ownership. > And you still have to pay property tax, based on the assessed value of your property circa pre-collapse No, at least not in California - counties were required to reassess property value down after the crash, and they did. In fact from what I've seen they haven't been assessing value back up enough to keep up with the market.
dragonwriter 12y ago
> And you still have to pay property tax, based on the assessed value of your property circa pre-collapse. Most jurisdictions have regular reassessment schedules, and while some have formulas that delay or limit the effect of market value increases, most don't for decreases which take full effect immediately.

by cbd1984 12y ago

twblalock 12y ago

I know people who had their homes re-assessed in 2009-2010 and their property taxes decreased significantly from the pre-collapse amount.

djrogers 12y ago

> If you buy a house at $X, and it adjusts to $X/2 because of speculation or job losses in the area, Historically that is almost unprecedented - and no, a few thousand homes in a couple of areas does not make it any better an argument. Over time, property values go up - it's not a theory, it's a fact. >you're still paying down the $X + $Y mortgage, where $Y is interest, fees, and whatever else the bank tacks on, now or in the future The bank can't 'tack on' arbitrary 'fees, and whatever' in the future on any decent mortgage - in fact I've never seen a residential mortgage that allowed that. If you don't get a fixed rate mortgage then your rates may rise, but that's an argument against variable rate mortgages, not home ownership. > And you still have to pay property tax, based on the assessed value of your property circa pre-collapse No, at least not in California - counties were required to reassess property value down after the crash, and they did. In fact from what I've seen they haven't been assessing value back up enough to keep up with the market.

dragonwriter 12y ago

> And you still have to pay property tax, based on the assessed value of your property circa pre-collapse. Most jurisdictions have regular reassessment schedules, and while some have formulas that delay or limit the effect of market value increases, most don't for decreases which take full effect immediately.