Is buying a house is accquring an asset or liability?
By gurusandip
@gurusandip (158)
India
October 8, 2006 6:46am CST
Asset in simple terms which gets money in your pocket & Liability takes money out of pocket.
Now, for a house, we can rely on resale value but we have to keep in mind the inflation. But actually house take money out of your pocket, by mortgage pay, property taxes, insurances, maintainences, utilities expanse, etc.
So, house is Liability.
17 responses
@mythmoh (3984)
• United States
17 Oct 06
It will be liability until you pay the mortgage value.but after that it will be a asset.Dont consider mortgage value as liability.It is equal to the rent you will be paying if you wont own the house.I don't think any other asset whick can give more value than a house.
@gurusandip (158)
• India
20 Oct 06
You are talking of house as equity. But it worth when it have
Inflated Cash Value = (Fixed Cost of the house + Maintainence/Depreciation + Mortgage)
@claudia413 (4280)
• United States
18 Oct 06
I'd say definitely an asset. Bought one for $52,000 and sold it for $106,000 after 12 years. Bought another 16 years ago for $118,000 and it's worth almost $400,000 now. A nice amount to add to our retirement next year when we sell and move to a smaller house.
@claudia413 (4280)
• United States
18 Oct 06
Also, if you itemize deductions, you can claim your real property taxes and interest on your mortgage.
@gurusandip (158)
• India
20 Oct 06
You bought it 12 years before so please account for the inflation. As money has no value if it is in lower multiple than inflation
@hi_shobhit76 (679)
• India
31 Oct 06
I think buying a house can never be a liability....after all you are putting your hard earned money to a use which would always fetch you happiness and you'll feel secure.
If that would be the case which you described it to be a liability then one wouldnt have bought a house at the first place.If he has done it then he is well aware of the fact that he ahs to maintain it pretty well.
So I completely DISAGREE from YOU.
@moneymoney (789)
• India
22 Oct 06
It could change if it is an appartment flat or an indipendent house. The land value is anyways there. And it can only increase with time. Only in exceptional cases it could be different.....refer my post regarding the 70,00,000-80,00,000 profit......
@banta78 (4326)
• India
21 Oct 06
I firmly believe buying house is an asset. As property prices are skyrocketing, value of your house would double, triple. Besides you have a roof over your head. and don't have to pay rent every month. and don't have to worry about moving to different rented apartments.
@KrauseHome (36447)
• United States
19 Oct 06
It would depend on whether or not you can keep up with the Insurance, etc. if it is an Asset, or a loss. We are going thru the same issue with our Condo right now, and deciding if it would be Cheaper to sell it, and maybe Rent again.
@KrauseHome (36447)
• United States
19 Oct 06
It would depend on whether or not you can keep up with the Insurance, etc. if it is an Asset, or a loss. We are going thru the same issue with our Condo right now, and deciding if it would be Cheaper to sell it, and maybe Rent again.
@deepesh_agarwal (68)
• India
19 Oct 06
Buying a house is always an asset because your house can either save your rent or may generate rent for you. Also normally real estate shows upward movement most of the time.
@deepesh_agarwal (68)
• India
19 Oct 06
Buying a house is always an asset because your house can either save your rent or may generate rent for you. Also normally real estate shows upward movement most of time.
@hikaruch4n (339)
• Australia
19 Oct 06
Depend.. if you use the house yourself, it's a liability
but if you lease it (and got more than you pay for it every month), it's an asset
@ashish1116 (131)
• India
19 Oct 06
Its definately an asset. I have bought an house 12 years ago and it is now 4 timnes my buying value.
