Post by Amadan on Jan 10, 2018 17:09:41 GMT -5
Well, if you're treating your house like a stock investment, yes. Not everyone buys a house planning to flip it in a few years, though.
(Ironically, for various reasons, I may be looking at selling and rebuying a - more expensive - home soon, and my current house, which I was planning to stay in until I retire, has lost value since I bought it. :\)
If I intend to retire and keep my house, it doesn't matter whether it goes up or down in value - the point is that by the time I retire, I will have paid off my mortgage and not be paying rent.
Maybe I do assume it will at least hold its value, if not appreciate, which would allow me to sell it and buy a house where I want to retire to.
The alternative is renting, and assuming you pay less than you would as a homeowner (which is not always true, depending on the market) investing the difference in something hopefully more profitable than a house, which is still speculative.
Point being, just because the housing market can go down doesn't mean home ownership is a bad financial decision.
Obviously, if by "nest egg tied up in their house" you mean they will literally lose their retirement if the housing market crashes at a bad time, that is also a bad financial decision.