Most people say buying a home is a great investment. Why?

Most people I know buy a home only to buy a bigger one down the road. They die long before they ever see that cash. Not to mention the loans they take out on the home.

They say they will pass the home onto there kids when they die? Aren't these kids capable of there own investments...?

I could go on and on.....

Slim

Well, mostly it's not about cash, it's about building up equity, when you talk in investment terms.

Plus if you get a house for investment purposes, the tenants pay it off.

Most real estate increases in value, rather than decreases and generally make the biggest upswing in the market on a 7 year cycle.

It is also considered a "safe" investment - i.e. low risk.

I know a lot of people (I'm in Australia) who have made a profitable income from investment properties and use this as their sole source of income.

Yes, if you are paying off your home and the interest rises even by a small margin, you may find payments hard, but hey, so what - either cut down on another expense (i.e. a few coffees and dvd rentals a week), or sell up.

As for taking out loans - if you look at it the same as paying rent, except you are actually getting something for your money, then it makes a world of sense....why pay off someone elses property when you could pay off your own?

it all about something called PROFIT

Well the home is supposed to increase in value as the years pass, and you can add value by fixing it up. Also the mortgage interest is a tax break.

i dont think i've ever met anybody that has sold a house for less than they bought it for.

If you look at it, a person who is renting a place is only throwing there money done the drain (they will never own it). Buying a home is a great investment, I would not go and purchase a home loan for over 15 years though. The way I look at it is I would rather buy a house for about 20,000 to 30,000. This leaves you plenty of money left to fix it up and add on. Yes children can make their own investments, but sometimes there are sentimental factors that play a role in it. Once I pass away my kids will have my house.

Buying a house usually is a good investment. Think about it, you got to live somewhere right? So if it is cheaper to make mortgage payments than it is to pay rent, why not buy a house? At least you know your rent will never go up. And you can paint the walls puple if you want.

Look at my situation:

I got a job in 1996, and I knew I would be in the area for a while, so I looked into rent, and I looked into condos. It turned out that with the tax deduction figured in, it cost less per month to buy a condo rather than rent.

This year, the situation changed. I got a new job, and it was a 30 minute commute, so I wanted to move closer to my work. I looked at condo prices and rents, and it turns out that it's 2-3 times more expensive per month to buy rather than rent, even with the tax breaks. So I sold my condo, invested the gains, and now I rent a place 5 minutes from my work.

In the future, if my rent goes up or house prices come down, I'll be ready with my down payment to buy another place.

It's pretty easy to figure out if buying a house is a good investment. Just do the math.

Aren't you forgetting the money your landlord used to take from you each month?

not everybody that buys a home gets the most out of it, but yes, buying a home is a good investment. regardless of whether your kids end up- with it down the road. if you buy a home...and I mean a home you can afford without killing yourself working to pay for it, you are building up equity...every payment you make is money going back into your pocket...if you pay rent...when you move out, you only have what you came with. with your own home, if you need to you can sell it later. it is yours, and property values generally just go up. if you buy a house now and want a bigger one later...you can sell it, or even better, rent it out to someone else for enough to pay your mortgage. also, the fact is, mortgage payments for a sensible house are less than rent payments, so you save money that way, as well.

do not make the common mistake of judging the world by the people that you know. you are a small cog. you do not know many people. read some books and learn about more people and things. travel. discover. investigate

homes have a reputation for being good investmenst in the past, this does not mean 100% they will be good in the future but it is something to go on.

It is easy to get banks or lenders to loan you money to buy a home, not so with other investments. try getting your bank to loan you 100% of the cost to buy stock? never happen. So with homes it is possible to INVEST with other peoples money (OPM) this means even people with no money can borrow some monesy to invest and get wealthy ( if the investments are good)

All you need is a job and good credit rating so they will take a chance on you.

Thsi country has historically experienecd a certain degree of inflation, especially in the finished products of housing. the reasons are not important. but most people believe, and probably rightly so, that this will continue in the long run. there may be ups and downs along the way, but generally there will be a gradual increase in the prices of homes.
You can get a 30 year loan on a home and live there and pay the mortgage instead of rent. it may cost more at first, but if you have a fixed rate, the cost of the payment in comparison to similar rentals will get easier and easier to afford over the years and you will get richer and richer as the value grows.
Any time you want, after two years, you can sell the home and pay off the loan and keep the profit which may be considerable. the first $250,000 profit is TAX FREE, if you have lived there two years.

You may want to do this over and over agian, as long as the laws are the same, or you may wish to just keep it and stay there. in the latter case it is not really an investment that you profit from except by the lowered effective shelter cost during your later life. this is a choice. you can always borrow out the equity to buy stuff.
If you are bold, you can do this every two years and make 125,000 per year tax free, providing market factors cooperate, but that is the same with any investment.
Ot anything in between. maybe sell every four years and make $50,000 per year averageTAX FREE. that is not a bad deal either.
You can do this with no effort and keep you regular job too. You will NEVER SAVE yourself rich. you must invest.

In addition, or alternatively, you can buy rental homes at 20% down and get a nice return on your investment while the tenants pay the mortage and you get tax shelter benefits. you can sell anytime and get cash proift but must pay about 15% or 20 % capital gains tax. Or you can do tax free trades for other property at greater leverage and then borrow out your equity and never pay taxes. It is better to die owning the property and give it to your heirs in a will because they will escape all tax on your gains over the decades by the stepped up basis rule. then they can sell it and get all the cash TAX FREE.

( some people actually love their children and want to get rich so they can provide for them beyond the grave)
in many case the kids are capable of thier own investments or maybe not. either way it is good for a family to accumulate wealth over the generations ans dpass it on to their heirs so they can buy things for their grandchildren. Just like old Grandpa Bush bought the presidency for his son and grand son and so did old joseph kennedy for his son. that is the way of the rich. make as much money as you can, use it to make more money, never pay taxes, gather power and influence, take over the world, be rich and enjoy life to the fullest while other poor saps that think real estate is a rip-off die in squalor or fighting in the wars of the rich with each other.
BUY REAL ESTATE MY BOY. YOU WILL NEVER REGRET IT.
borrpow money to do it. so long as the inflation rate exceeds the interest rate, you have got it made. many great fortunes have been made on RE. the QUEEN OF ENGLAND lives on the rent her ancestors stole centuries before. Most of America is land stolen from the indians and sold to the farmers by the railroad who had it given to them by their pals in government.

Many kids today have a hard time making succesful investments because this old world has been discovered and many former opportunities tapped out. You cannot build a railroad or get millions of acres of forest handed to you to log out. it has already ben done. you have to bend to the ways of the day and be nimble to get rich. Investing in Real estate is one way open to anybody with a job and good credit. Get that and you are on your way but you must be bold and have the INTENTION to do it. GO GO

Even when rich people got rich on stock or hamnurgers, they eventually spend the money on REAL ESTATE as the best long term investment.
Thisnk aboiut it. MC DOnalds restuarant may SEEM to be in the business og hamburgers, but they are really real estate tycoons. they sell franchises and LOCATIONS with STORES to investors. That is Real Estate, not hamburgers. They make their money from selling the stores, not the burgers. GET IT?

Hummmm...sounds like you have a strong opinion on this subject...lol
For the most part, the value of property increases as time goes by as long as the house is maintained. It is possible for a house to depreciate but not likely. This would happen if the house (or neighborhood) was basically left to ruin.

As for people buying other homes and never seeing their home paid off, a home is the best investment for tax purposes. All the interest that is paid into the home over the year is tax deductable and that in itself is well worth the investment.

Hope this helps.

One positive aspect of buying a home is the money that you would be throwing away on rent is building equity in your home. Plus you can deduct the interest that you pay on the loan.

It's rare that a house loses value (unless it gets really run down). You always have the ability to take money out of the home (home equity loans); you can sell if you want and make back your money, plus more; you have the security of knowing you're never going to be evicted; your credit rating goes way up.

Why, I'll tell you why, in the suburbs of Portland, Oregon, a house bought for 214 grand in 1998 sold in 2004 for 415 grand. The neighborhood hadn't changed much. Granted, there was a 70,000 remodel, but that's still $130,000 in 6 years. I've heard of parents with spare income buying a house for their kid to live in when they go to college and selling it when they leave to help compenste for the tution. Some markets are just out of control.

I'm sure houses are a good investment, but you also have to think about all the time and money put into them. All kinds of maintenance and repairs- lawnmowing, painting, plumbing, termites costs time and money. Also, I think once people own a house they are more likely to spend more money trying to fill it with stuff.

Many kids would thank their parents for buying a house when they did. Becuase now, their parents home might have trippled or more in price since the parents owned it.

Buying a home is a great invsetment becuase of the equity built into the home after holding it for years to come. If you need a place to live, you will either rent, or own. IF you rent, you are paying your landlord and your landlod is paying his mortgage. Each time you make a payment on a rental apartment or house, your landloard is this much closer to beocming richer. You are basically paying the mortgage of the landlord.

If want to own your own home, get over the fear that you will not get anything out of it. Then realize that buying a home is not about making cash up front. Buying a home is about creating a home that is entirely YOURS and your family's. Its an emotional decision to buy a home. A home is made for the family.

property is a great way to have your money earn you money..it also cuts you a tax break, and you put say 1700 into your mtg loan instead of rent. maybe you just live in a bad neighborhood that all these people are dying.? everyone that i know who owns a home, haven't died and they have purchased other homes and more...

The value can't decrease so you at least make your money back. Usually you can do upgrades too and that helps you make a lot more. My husband and I buy repo's of the court steps. We paid off both cars that way.

Houses appreciate. That means you can sell them for more than you paid and the money you invested grows.

Why pay on something that you never can call your "own". Don't give someone else your money for the rest of your life and never see anything from it. If you own something, you can do ANYTHING you want to it and don't have to worry about someone else telling you whether it's okay or not. Also, if you buy one and then turn around and buy another, you already have equity into your home, and can usually make some money off of the first one!

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