"NOYB" wrote in message
link.net...

wrote in message
ups.com...
Here's the real life example:
I paid $825k for the current home on the water.
The last house to sell just like mine sold for $1.225m.
After realty and closing costs, I'd clear about $360k

I sold my old house for $560k last year (not on the water)
The last house to sell like my old one just sold for $625k.
If I bought the new house for $625k, after closing costs, I'd be in it
for
under $650.


So I would net a quarter of a million dollars if I sold my current home
and
bought my old one again.


That's profit, right?


*****************

No, it's merely the reorganization of numbers on the asset side of your
balance sheet. Even if your house was in investment, you haven't
realized a gain until you sell it. Your neighbor's sale didn't put any
money in your pocket. You need the house to live in. The amount of
money the house is worth is meaningless, as long as you are going to
personally consume the asset by taking it for exclusive use.

The good news is that if the average income in Nipples doubles in the
next couple of years, (is that likely?) your $1.2mm pad will be "worth"
$2.4mm. The bad news is that if you sell the one you've got, and don't
elect to lower your standard of housing, you'll simply have a higher
number attached to an asset you don't have the flexiblity to sell.

Now, it you had purchased *two* or more homes for $825k and sold oneof
more of them for $1.225, that $400k spread would indeed be gross
profit. You'd probably walk off with about $300k net after
commissions, cap gains taxes, local conveyance taxes, etc. Selling your
personal house, and immediately replacing it with one costing as much
or more, does not create "profit"

But my example had me replacing my current house with my old house (which,
BTW, is a nicer *house*...but not on the water). And when I was done with
everything, I'd end up in my original house with a mortgage that had been
reduced by $250k in just one year. How'd I reduce my mortgage by a
quarter of a million dollars in one year? From the *PROFIT* I made in the
house on the water.

Waterfront homes are appreciating at twice the rate of non-waterfront
homes.


Or you could just rent........you have no obligation to reinvest your
capital gains, thus you have increased your net worth.

NOYB wrote:

(elementary level example of leverage deleted)

Your additional properties are investments. Your house is your home.
If you cannot grasp that very simple concept, you likely do not realize
that hyper accelerated real estate markets in many parts of the country
(Calif being a frequent example) are not always one way streets.

When your house that you're choosing not to sell for $1.2 million
possibly corrects to a value of $975k, (and you hold the $1mm mortgage
you mentioned elsewhere in the thread), it won't be Chuck wondering
"How the hell did that happen?" Chuck knows.

BTW, I could write the book on leverage. You don't want or need to know
the details, but write it I could.

P.Fritz wrote:
"NOYB" wrote in message
link.net...

wrote in message
ups.com...
Here's the real life example:
I paid $825k for the current home on the water.
The last house to sell just like mine sold for $1.225m.
After realty and closing costs, I'd clear about $360k

I sold my old house for $560k last year (not on the water)
The last house to sell like my old one just sold for $625k.
If I bought the new house for $625k, after closing costs, I'd be
in it
for
under $650.


So I would net a quarter of a million dollars if I sold my current
home
and
bought my old one again.


That's profit, right?


*****************

No, it's merely the reorganization of numbers on the asset side of
your
balance sheet. Even if your house was in investment, you haven't
realized a gain until you sell it. Your neighbor's sale didn't put
any
money in your pocket. You need the house to live in. The amount of
money the house is worth is meaningless, as long as you are going
to
personally consume the asset by taking it for exclusive use.

The good news is that if the average income in Nipples doubles in
the
next couple of years, (is that likely?) your $1.2mm pad will be
"worth"
$2.4mm. The bad news is that if you sell the one you've got, and
don't
elect to lower your standard of housing, you'll simply have a
higher
number attached to an asset you don't have the flexiblity to sell.

Now, it you had purchased *two* or more homes for $825k and sold
oneof
more of them for $1.225, that $400k spread would indeed be gross
profit. You'd probably walk off with about $300k net after
commissions, cap gains taxes, local conveyance taxes, etc. Selling
your
personal house, and immediately replacing it with one costing as
much
or more, does not create "profit"

But my example had me replacing my current house with my old house
(which,
BTW, is a nicer *house*...but not on the water). And when I was
done with
everything, I'd end up in my original house with a mortgage that
had been
reduced by $250k in just one year. How'd I reduce my mortgage by a

quarter of a million dollars in one year? From the *PROFIT* I made
in the
house on the water.

Waterfront homes are appreciating at twice the rate of
non-waterfront
homes.


Or you could just rent........you have no obligation to reinvest your

capital gains, thus you have increased your net worth.


I suppose, you could rent, if your wife took the house in the divorce
settlement. After all, seeing how you don't have what it takes to raise
a child, you need all the help you can get. What a low life scum you
are.

wrote in message
oups.com...

Yeah, how DID that happen, when you've stated here that you have an
interest only mortgage? Not only did you NOT pay cash, you're not even
paying down the balance.

LOL!

You really do get dumber by the day.

.... NOYB is
playing a sucker bet, to the sure profit of the bank, the insurance co, &
his local tax collector... leaving him holding the risk and an uncertain
gain.

NOYB wrote:
You don't know what you're talking about:


Actually, I know exactly what I'm talking about.

The tax collector sees very little additional income from the rapid
appreciation. "Save Our Homes" ensures that the rate can't go up more than
3% per year.


Until the town needs more new schools or a new landfill or a new water
treatment plant or it's bonds are about to get downgraded or something.

Isn't it amusing that you are determined to avoid having to pay your
fair share while urgin tremendous deficits on everybody else...


The insurance company also gets very little money from the appreciation.

The insurance company isn't taking their profit from appreciation.
They're taking it out of your wallet.

The bank sees no additional money either. The principal doesn't increase.


You have no concept of compund interest, do you?

You seem to have a problem distinguishing between your wishful thinking
& reality. No surprise considering your political views...

DSK

"Joe" wrote in message
news:7AnVd.51855$uc.46260@trnddc08...

wrote in message
oups.com...

Yeah, how DID that happen, when you've stated here that you have an
interest only mortgage? Not only did you NOT pay cash, you're not even
paying down the balance.

LOL!

You really do get dumber by the day.

Every time you think asslicker has reached his low point, he goes out and
proves he's got lots of room to spare.

He's the "KING"

"NOYB" wrote in message
ink.net...

wrote in message
oups.com...

I suppose, you could rent, if

...the Feds seized your home for growing marijuana.


I hope not, that would be seizing a liability as opposed to seizing an
asset. ;-)

NOYB wrote:
wrote in message
oups.com...

I suppose, you could rent, if

...the Feds seized your home for growing marijuana.

There you go, NOYB. I once thought you had at least enough fortitude to
not stoop to the level of Fritz, JimH, and Smithers, ie: letting things
pop into your head without any facts to back it up. But, alas, I see
that you are at the bottom of the barrel with them, now, making up
stories about me in order to bolster your pathetic lowly ego.
Now, do you have ANY facts to back your allegations up?

Joe wrote:
wrote in message
oups.com...

Yeah, how DID that happen, when you've stated here that you have an
interest only mortgage? Not only did you NOT pay cash, you're not
even
paying down the balance.

LOL!

You really do get dumber by the day.

Really? You don't think that NOYB has an interest only mortgage? YOU
are the dumb one, JoeTechnician. He has stated just EXACTLY that, right
here.

NOYB wrote:
wrote in message
ups.com...
NOYB wrote:

Chuck is the first person that I've heard say that a home in a
rapidly
appreciating real estate market is *not* a good investment.

****************************

I'm seriously surprised.

Your house is a house. It's not an investment. Sky high and soaring
housing prices are only a good thing if you own other real estate
in
addition to your primary home. You can have your home, (which you
need), or the money tied up in it, but not both.

When you cash out an "investment" your options in life should
increase
substantially. When you cash out your house, you get to live in a
yurt.

But a really, really nice yurt.

Of course, I could retire to Snellville, buy an entire trailer park,
and
still put a million in my pocket.

Yeah, right. You are financially scraping by. You've said here that you
have an interest only mortgage. Anyone solvent would be paying on the
principal.