" the majority of the populace can't save so they should take out a mortgage and even if they lose money they will still be better off because at the end of the day they will have an asset that is worth a little less"
- If i buy a house for 500K today and it's worth 500K five years from now that is not a little less, it's a LOT less.
UT when you look at an investment the only thing that matters is the TOTAL RETURN. Nothing else. So why do you and the rest of the bulls feel the need to make arguments to the contrary?? It's a basic investment principle.
Don't get me wrong in some ways i wish i was older and i could have flipped properties from 2000-2008. Anyone who did so made great returns....but just because they have it doesn't mean that's how it's going to be in the next ten years, or do you envision the same level of growth???
The median price here in Perth in 1999 was a little under 150K. Today it's around 480-500K (numbers may be off by 10K here or there as i'm going off memory, but feel free to use the ABS site for the true numbers). That's well over a 200% increase in price in the last decade. If we have the same level of growth until 2020 the median price will be WELL OVER 1 million dollars. DO YOU SEE THAT HAPPENING???
If you beleive prices will stay flat for five or ten years (or even LONGER) the difference in buying today and in five or ten years time is that you would have saved alot of money, even if you didn't save/invest money not going to rent because your real return is negative.
