[shaggerty]

Even if your house ends up being less than you bought it for you still have a house. Assuming you want to live in the same area long term it seems wiser to finish a mortgage and be left with a house that's worth less than you paid for it versus paying rent for the same amount of time and ending up with nothing.

[astura]

I think you're ignoring the significant carrying costs of a house. My house last year had over $11,000 in carrying costs in just taxes, insurance,and interest. Never minding the upkeep and repairs (which are significant yet difficult to estimate). There's other hidden costs like opportunity cost, the return on investment you'd be getting if you didn't have that money tied up in your house.

[toomuchtodo]

Houses have almost always kept ahead of inflation, and carrying expenses replace rent.

[astura]

Read the post I'm replying to, we're talking about a house that went DOWN in value.

[toomuchtodo]

I did. It’s extremely rare for real estate to decline in value, and walking away from the property is always an option if it has (or a short sale, which is must less detrimental on your credit).

[astura]

Even if it were true (and it's not[1]), the topic at hand is a hypothetical case where "your house ends up being less than you bought it" and that's what I was directly replying to. If you lose money on the sale price is (almost certainly) not even close to the amount of money you have to spend just to own the house.

[1] I personally know at least three people who sold houses for less than the bought them 7-10 years later. My parents have owned their house for 25 years and while the dollar value went up it hasn't kept pace with inflation (recently got three appraisals) even though they have cared for it and even added an extra bathroom.

[TheCoelacanth]

> It’s extremely rare for real estate to decline in value

You and I must have very different ideas of what the word "extremely" means.

> walking away from the property is always an option

That is only true in twelve states. In the other 38, the lender can sue you to recover the difference between the house's value and what you owe even after they foreclose.

[toomuchtodo]

As I mention above, you need to do your due diligence. Investing without knowing the rules is fraught with peril.

I only use non-recourse mortgages when investing in real estate. YMMV.

[shoo]

It depends. On parameters like interest rates and rates of return on other asset classes and rental prices and inflation. There is opportunity cost - in some circumstances paying cheap rent and investing the difference into other investment asset classes might leave you better off in the long run. See the New York Times rent vs buy thing.