Buying a Home is an asset or a liability?

A house is not asset for house purchaser but its liability. Asset is one which add money and liability is one which takes your money. Definitely house is an asset for Bank if you have bought the same by taking home loan, you will pay interest / EMI and Bank is earning money from your house. Every month you have to pay for maintenance, Municipality taxes, EMI which costs you a huge amount. Many peoples you buy a Flat comes from economically weaker section and they dream of their own house under the burden of lakhs or Crores of Home loan, it's not actually an achievement. I may be little harsh but it's the truth.  

The reality is that many people think that house is an asset, they dream of buying a house as an investment, but the problem is they don't know the difference between investment and asset. I am not discouraging you to buy a home, but simply wants to understand you that house is only for your living and don't buy a home for Investment. 

People struggle financially due to bad financial advice, if someone advising you to buy a home for investment, he is not telling you investment for whom, you take home loan for 20 years than your house is an asset for Bank for next 20 years and financial burden for you for next 20 years.

If you look at your Bank statement, you will definitely know your house is who's asset. Most people don't own a Home but own a mortgage. You own a home only if you buy a home without Loan and even in that case it's not Investment its simple your residence with liability. 

So how is real estate a real investment? Visit Blog | Pune Housing Market to know more!


 


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