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[quote=Anonymous][quote=Anonymous][quote=Anonymous]I question whether we did the right thing buying our current home (not in DC area). We put $120K down on a $535K house and pay $2800 per month on a 30-year mortgage.  Houses in the neighborhood rent for about the same - $2800. When we go to sell, we will pay at least $25K in Realtor fees, so unless the value on the house goes up a lot (which I don't think it will) or if we stay here a long enough time to build up equity (I don't think we are), I think we would have been better off investing the $120K and renting.

Now the DC area market is much stronger than where I am. We bought there many years ago and made out quite well when we sold.

So basically the two big factors are - how long you will stay in the house to build up equity.  And whether you think housing prices will continue to increase.[/quote]

A good chunk of that 2800 will be tax deductible though.[/quote]

So what? It is tax deductible because it is interest, not equity. There are many downsides to being heavily leveraged that can more than offset the MID.

I don't believe anyone has mentioned the possibility of being underwater when you need or want to move. Way too many people have virtually nothing in reserves after they buy. If such buyers want to move in the early years of the amortization schedule, they need to have realized about 6 percent appreciation (to pay off our realtor friends) just to be able to sell the home. I know several people that have had to turn down good job opportunities elsewhere because they are underwater and rents will not cover the mortgage. And these people live in DC, where supposedly the market is invincible. I can only imagine how bad this issue is in a place like Manassas.[/quote]

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