seneca
@seneca
This broke my brain a bit. Chart shows a typical $500K mortgage at 8% fixed. You’re mostly paying interest for decades. Equity only kicks in the last 7–10 years. Total paid: ~$1.2M. Interest alone: ~$700K. I get its pros but levering up into an illiquid asset in a post-ZIRP world .. ?? Pls help me make sense why this is sold as the safe and very normal thing to do.
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Erik
@eriks
most are desensitized to the risks and it doesn’t help that realtors are most times trained on only that single market, i don’t think the next 30 will be anywhere close to as easy as the last 30 in terms of real value appreciation can be a good *life* choice tho while potentially not being the optimized financial choice
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seneca
@seneca
this angle i am fully aligned with. good friend told me a long time ago that home ownership is a luxury, treat is as such.
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Erik
@eriks
yep, where ppl can get into trouble is thinking of primary home as an investment
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krel
@krel
i own a house and ive never seen it as a financial investment its a life investment to have a happy family, happy kids, day to day quality of life if be happy to pay any amount of interest on that tbh, as long as i can sustain it month to month
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Erik
@eriks
exactly, this is important and imo it goes far beyond just a money decision, my point wasn’t to say everyone or even most ppl look at it as investment, it’s the ppl that do that could be left unsatisfied for many it’s a good choice! and hopefully ppl also continue to realize it’s not the only choice, everyone’s situation is unique
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