When Did Your Home Become A House?


Recently, a client asked me “Exactly when did we start viewing our homes as an investment rather than the place we live with our family?” I didn’t have an answer for her. I knew what she meant though. Originally, we purchased a home for shelter and then because we needed more space or wanted our children to go to a particular school or needed to be closer to our job. Now, we have those same needs but also ask ourselves the question, “How much will this house appreciate; how much money will I make?”

Do we ask ourselves that same question when we buy a car, furniture or clothes? Okay, you are correct if you said that a house is a much more expensive purchase but exactly when did we start expecting a large return on investment on our house? I took that question to a Certified Public Accountant who replied with a bit of history on when mortgage interest became deductible on our tax return and how initially the government wanted to encourage us to have our mortgage paid off in 30 years so that when we retired we would not have a mortgage payment thus assisting in our retirement planning. The CPA then explained how instead, many people began using their houses as piggy banks. No real answer on when we starting viewing our homes as investments.

Perhaps we would be better served to view our home as the place we live instead of a part of our financial portfolio.

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