No Chris, it's not a simple concept. If your home appreciates in value by
$50k, then the next home you buy is also $50k more expensive than it used to be.
So unless you're planning on living in a tent or you're a house
flipper, home values are a zero-sum game.
Robin,Your home is an asset and yes it will mean you'll have
more money, assuming you do sell it and buy a new one. Regardless of what the
price of my next home is, if my current home is worth $50k more now than it was
7 years ago, I'll be $50k richer whenever I sell the home, assuming prices
stay.Yes I have to buy a new one. But assuming prices hadn't
increased, I'd bet $50k poorer when I bought that new house and sold the
old one.Simple concept really.
Why do people look at their home as an asset? I thought a home was a place to
live? In other words, if you were to liquidate your home (i.e. sell it), where
would you live? The only solution is to buy or rent another home - hence, a
home cannot be truly considered an asset because you can't live without
one.Home values are a red herring. Just because you house is
increasing in "value" doesn't mean you suddenly have more money.
It's Obama's fault.
People complain about the state of the economy.However, when you
compare the stock market( read 401k) the housing market, and unemploymentto the second half of 2009, I have a hard time believing that the wealthy have
not fared extremely well on the last 4-5 years.How bout looking at
the good for a change.
With the increase I am finally able to refinance because my home has over 20%
equity. Rates are still at an all time low so don't miss out!