Is Owner-Occupied Real Estate an Investment??

Are you serious??? It's clearly regarded as a liability, I mean money-pit. Assets put money in your pocket. Your house takes money out of your pocket.

First start off with the book, "Rich Dad, Poor Dad," that should sum it up for you pretty easily in a very concise fashion.

It is an asset, yes. But owner occupied housing is also a consumption item in your household budget. If you don't view owner occupied housing as a liability as well, particularly if you have a mortgage, then you are not looking at the full financial picture of owning a primary residence. Is this fact often omitted by real estate professionals? Yes, but that doesn't make it less true.

Ugggg, this endless argument.

What CPI calculations assume is that whatever the difference between the total, after-tax amount you spend on a home and what you would spend on an identical rental = asset appreciation. The amount you spend up to that point = rent paid to yourself. Since MOST people in NYC pay more, all in, to own than rent for the first few years, its NOT an income from an investment. Its NOT investment income until your total expenses, after tax, including EVERYTHING, are less than the rent you would pay on the same place.

The equity is always an investment, yes - but nationwide many have no equity, and even in New York, many condo owners are underwater.

So for MOST who have purchased homes nationwide and in NYC in the past five-ten years do NOT YET have an investment. They MAY. But not yet.

Of course it is not an investment in the classic sense. Most people (you and francis likely notwithstanding) do not buy a home expecting a roi similar to that of other investment classes and load and dump accordingly. They don't weigh the benefits of putting their money into Apple vs. a 2/2 on CPW, but they do have a reasonable expectation to be made whole, and for the asset to generally follow the curve of inflation. There are people who value home ownership far more than others, and are willing to accept the gyrations of the market in exchange for a quality of life they consider superior to living in somebody else's home. People who don't get that, never will. On the other hand it is quite similar to other investments in the sense that those who are blind and ignorant to the state of the market, or to what makes a property desirable and sellable, are more likely to suffer negative consequences. I have never bought a home (12 now and counting) without first weighing my ability to quickly shed the burden if my situation changed.

So the short answer is yes, and no. I get that you believe wholeheartedly that your home is an investment, because of your success riding the bubble and dumping at the top. But now you are burdened by the uncertainty of the future and have sequestered yourself to the Frigidaire farm indefinitely as a result. Some people can only invest when it's a guaranteed slam dunk but I don't consider people like that investors any more than I consider shares in Apple corp equivalent to a home.

Sorry no. This isn't "classic sense", this isn't "maybe".

Its not an investment.

And folks are confusing assets with investments, they're different. An asset is not necessarily an investment.

Your apartment, like the car you drive, is an asset, in that they have worth. Neither is an investment, which requires an expectation of financial returns. The car and apartment are the opposite, they both cost more money to maintain than they pay out. That you get something out of it isn't a bad thing, but its not an investment.

Simply put, owner-occupied real estate, by definition, is not an investment.

swe, if they are both the same can you tell me how I can depreciate my apartment like I do my car?

I agree when you buy a home to live in you are not investing.If after living there for many years, in some cases a lifetime, that asset is worth more when you sell it.

It is the question i have raised before on here. The issue with living in the city is there is more of a notion of trading up. So you have people buying an apartment to live in for 5 years then flip to the next. In a great economy i guess it works because values increase more rapidly, but in this environment it is just a mistake as even if you get a 10-15% appreciation over the next 5 years, you are going to give that all back in closing costs and have no excess money to put towards that larger apartment.

I am of the mindset of buying an asset for use. If after many many years of use it is worth more then what i paid great, if i get slighly less, that is fine also because i am getting use of the asset as i please (condo) and not under someone elses restrictions.

And i agree that a home is like a car. I bought my car because i was goign to use over many years and when i am ready to get another car it will have residual value that i can sell for. Others will lease a car and pay someone for the use of the car and then give it back, just as you would rent an apartment.

I really believe it is what you want at the end of the day. I want to be able to make my home my own. Which means if i want to move a wall, rip out a kitchen or anything else, it is mine to do as i please and to that it is worth the fact that when i sell maybe i get a bit less then what i paid.

Depends if it goes up.

> swe, if they are both the same can you tell me how I can depreciate my apartment like I do my car?

They're not both the same, not sure where you got that from.

But depreciation is factored into the mileage allowance, so thats how you do it.

"And i agree that a home is like a car. I bought my car because i was goign to use over many years and when i am ready to get another car it will have residual value that i can sell for. Others will lease a car and pay someone for the use of the car and then give it back, just as you would rent an apartment"

thats the right way to think about it.

It's capitalized rent.

The answer is if you are not prepared to sell it, then its a mistake to "consider" it investment.