Your Home - Asset Or Liability?

[The_Big_K]

Its time that I drop in to add my $0.02

CrazyBoy got the concept right. I'll add a few more lines to make the stuff clear.

As long as you - the owner of your house, live in your home, the home continues to be a liability. Because, it constantly takes money out of your pocket.

But the moment you sell your house, you are no longer owner of the home. I mean its not *your* asset.

There is an exception to this. Let's say that you live in a big house and you rent a room or two. Your monthly rent earns you more than what you spend on the house. Then your cashflow is positive and your living home becomes an asset. Quite interesting, right?

So next time you hear people talking about the biggest asset of their life -their own home, stop them and give them a dose of 'the basics'

Happy Posting!
-The Big K-

[crook]

i got it 'right' too. nice thread! keep up the good work guys!

[The_Big_K]

Guys, did you realize?

To generate new ideas and be creative, you have to start questioning the basics

say what? further views on this topic are welcome

-The Big K-

[integratdbrains]

Take example 3: I buy a house and rent it out for a rent that is equal to or greater than the EMI that goes to bank. I am not sure if this is possible . So in this case, I'm actually generating some money out of my home. But this is a special case.

In India especially in cities like mumbai this is seen very often.the government employees get quarters to live till their retirement so what most people do is try to change their home which is a liability to an asset by buying another house and give it out on 'rent' which sums to more than the EMI that is to be paid.So as long as the individual is an employee he will be using the government quarters as an asset!

[aashima]

how can home be a liability??? well calling home an "asset" is wat i'll prefer more than calling it a liability. no doubt it can take ur lifetime to build yer dream house and and can cost u a huge sum of money too but cmon yaar... its just once in a lifetime u buy a house for urself... and its a place which z alwaz the most comfortable place in the world.. no matter wat!!! u work the whole day but after all of its... its just yer home where u find the ultimate peace of mind.... well i go for asset.... HOME SWEET HOME.... and being a hosteler who else can know the importance of home more than me

[The_Big_K]

There you go! Let us keep the 'emotional' part aside.

Anyone to answer aashima's points?

-The Big K-

[aashima]

the best admin thanks biggie...

well very recently i witnessed a survey programme on television asking ppl abt their opinion regarding their priority in comparison to bulding a house... 88% of the people preferred to own a lavish and comfortable house for themselves rather than any other luxury or requirement...

[crook]

Originally Posted by aashima

the best admin thanks biggie...

well very recently i witnessed a survey programme on television asking ppl abt their opinion regarding their priority in comparison to bulding a house... 88% of the people preferred to own a lavish and comfortable house for themselves rather than any other luxury or requirement...

agreeed! say thanks to our age old teachings. Grow up, get a job, buy a house ....

of course, shelter is one of our basic necessities. but the question under discussion is if the house that you live in, is an asset. as biggie says, let us keep the e-motions aside and think rationally.

the best outcome of this discussion would be to learn the difference between your assets and liablity. Would you call your cell phone an asset or a liability?

the answer is simple. is the phone putting money in your pocket?

[aashima]

Originally Posted by crook

agreeed! say thanks to our age old teachings. Grow up, get a job, buy a house ....

of course, shelter is one of our basic necessities. but the question under discussion is if the house that you live in, is an asset. as biggie says, let us keep the e-motions aside and think rationally.

the best outcome of this discussion would be to learn the difference between your assets and liablity. Would you call your cell phone an asset or a liability?

the answer is simple. is the phone putting money in your pocket?

well i guess liability simply means taking a legal responsibility of yer belonging... being responsible for house is a problem??? well may be am wrong but do explain me if i am...

[Jerry]

Originally Posted by integratdbrains

Take example 3: I buy a house and rent it out for a rent that is equal to or greater than the EMI that goes to bank. I am not sure if this is possible . So in this case, I'm actually generating some money out of my home. But this is a special case.

Read that !

Being responsible for the home is not a problem. I feel the conversation is off-track.

Liability here is used as 'accountability'. So I guess, I'm with crook's point.