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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: Moominoid who wrote (62750)	4/25/2005 2:52:42 PM
From: Elroy Jetson	Read Replies (1) \| Respond to of 74559

American debt levels, driven by the desire for home ownership, has created a distorted economy. According to one economist, most American families would not be able to come up with a sum of $3,000 without borrowing. Once you are already in so much debt, why not lease a new car? At a minimum I believe living as a homeowner in a lifetime of debt erodes spending discipline. One effect of this lifestyle is that home owners rarely compare their home investment to other possible investments. I think the fairly recent law which allows up to $500k of gains on your residence to be tax-free was very very bad tax policy. On the other hand, the AMT is rapidly removing many of the tax benefits for home ownership, deducting mortgage interest and property taxes, as more inflation pushes more incomes past the fixed AMT limit. We would be better off if real estate were placed on an even footing with other investments. .