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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Freedom Fighter who wrote (63009)	6/22/1999 8:44:00 PM
From: Skeeter Bug	Read Replies (1) \| Respond to of 132070

wayne, i know folks who have made $200k in the market since last october via co. stock options and they've made $25k in salary during the same time frame. do you include the $200k as income when saying that houses track income?

To: Freedom Fighter who wrote (63009)	6/23/1999 12:42:00 PM
From: benwood	Read Replies (2) \| Respond to of 132070

I agree, Wayne, there are many factors to be considered, and one of them is that the average homeowner moves every 7 years or so, not only keeping them linked with rising real estate values, but causing them to lose on their sell/buy expenses (that the renter doesn't have to contend with). For example, if I bought and sold an ordinary house like mine (in Seattle), it would cost me about $20-25 grand, plus my new house would cost me about 35% more (if it's a similar home) because of the appreciation of the last 6 years. When I was vacationing in Vancouver B.C. recently, the National Post carried an article about a study which showed that it was cheaper to rent than to buy a single house -- over a 30 year period! Of course, their assumptions were critical, and a slight change in return of investment would change the outlook considerably (housing costs were rising slowly in their area and so in their calculation, too). But it did illustrate that there's more to it than meets the eye. The main factor they considered that many forget is the money you don't put down into a house -- they invested that at a modest rate of return. In the US, you have the tax issue to consider, and I don't recall if they got such a good tax break in Canada. I suppose part of what I trade in buying a house is stability of payments which are higher up front but don't increase over time, and if you're lucky, you could come out with some capital gains, too. Plus, if housing prices go up a lot, I can choose to stay put (as long as my job is nearby). And as you pointed out, the annual property taxes will increase over time; in fact, I actually know people whose tax burden exceeds their retired or nearly retired mortgage.