Your Home - Asset Or Liability?

[aashima]

Well yes it could be the first thread to be concluded but before that we mus configure the majority as in how many call home an ASSET and how many call it a LIABILITY after all the discussions!
Biggie you can add a poll to finally conclude it.

[Romeos_person]

While owning a house might be a liability, my thoughts are that it is an assest overall.

Shelter is a requirement, ie I have to have a place to live. I can either pay rent or a mortgage. So, is it even a true liability? I would argue not in the traditional sense. While it is money out of my pocket, it is money that I am required to spend.

In the case where I am paying the bank, I have the opportunity to get some of my money back if not more in the future.

The money paid in taxes are a net loss, however that money is often rolled into rent, so I'm breaking even there regardless of owning or renting.

In addition, since I can deduct the interest paid on my loan from my taxes, I am coming out farther ahead by making the payment on a home of my own rather than in paying rent.

While the investment may or may not pay off as well as other investments down the road, I would argue that it is an assest. And even less of a risk than investing in say the stock market because it is money that has to be spent and if not put into something that you own, it would be money that is a complete loss.

Now, if you purchase a house that requires significant repairs or is a "money pit", then it might be more of a liability than an assest, meaning you cannot get your money back out of it. Just like any investment, you certainly need to do your research to avoid the investment becoming a liability.

[aashima]

I completely agree with Romeos. In a nutshell, home is an asset but if considering certain acute cases like frequent repairs etc, it can be a liability!

[contentwriter]

Home is basically an asset but it turns into a liability when one has to borrow loan on it.