[sokoloff]

An appreciating asset bought with leverage provides one of the most readily available means to go from "I am in the bottom quartile of net worth" to "I have at/above the national median net worth".

I did buy basically the most expensive house we could afford (slightly less than the most expensive we could qualify for) in 2007 in a desirable city. That decision (vs continuing to rent or buying a $500K condo in that city) has likely added more to our net worth than our working for the last decade did. We bought it as a place to live and raise a family, but the financial upside (as yet still an unrealized gain) is large enough to not ignore.

[benj111]

That's with the benefit of hindsight though.

Were you thinking the same in 2009?

[sokoloff]

For us? Yes. We were still thinking that this is a good place to live and raise a family (that we just started that year).

On the money side, I continued to believe throughout the GFC that Cambridge, MA was going to continue to be a desirable place to live and work. I don't think the Zillow guesstimate on our house ever fell more than 5% below our purchase price, which was vastly better than our 401(k)s and brokerage accounts. (I changed my personal finance tracking spreadsheet in 2013, so I don't have records of house price estimates prior to then to confirm and Zillow only seems to go back 10 years.)