The Destruction of the Middle Class is nearly complete.

[Xavier_Onassis]

Continue despising. It is what is expected of you.

The sirs despisatron is still in working order.

[sirs]

Like a good lap dog....ignore all those facts presented, and just keep licking their master's butt   

[Plane]

The home interest deduction is advantageous for at least some homeowners. It makes it possible for some people to afford a home.

People need to think over very carefully very dollar they spend on anything.

Realtors like to give the impression that they are performing a service to the public, when actually, they are adding 5 to 8% to the proce of the home, and a lot more when you consider that a 30 year  mortgage for $26,000 at 8.5%  actually costs the homeowner over $79,000 by the time he pays it off, IF it is EVER paid off. I am the first person to fully own this house and it was built in 1947.

   If there were no deduction on mortgage interest , how much would there be a different set of persons buying land?

     What if taxes were correspondingly lower across the board?

       As it is , the government is joining the realtors in trying to persuade people to buy land.

       I am invested heavily in land and I am not sorry , yet, nor am I getting ahead this way , yet.

        Investing in land with a mortgage is certainly not the best choice for everyone , and the government encouragement to do so isn't proven to be a good idea.

[Xavier_Onassis]

The mortgage deduction does not apply to land. It applies to a home that you actually live in, and you are limited to two properties.

Real estate is a good investment mostly only in the case of owning your residence. Real estate as a way of making money has a lot of disadvantages. First, you need to buy homes are cheap and interest rates are low, This seems to occur maybe for a couple of years every decade. Then you need to sell, preferably without as broker, when home values are high and interest rates are low. This happens even less often.

The best way to make money in real estate is to invest in mutual funds that specialize in it, or in what are called REITS (real estate investment trusts). 
If you have your money tied up in a house and need the money, it can take rather a long time to sell it, and odds are you will need to use a broker, which will eat up a lot of your profit. If you rent a house, there is always the problem of maintenance.  The lights go out, the toilet backs up, the furnace stops working, the AC goes out.You must time your rental contract to what your anticipated needs might be.

The REITs and the RE mutual funds are far better. They invest in commercial real estate, and all you need to do to get your money out is to tell the brokerage: "get me $x", and within three days they do, and you have a check within a week at the most. No mutual fund ever flushed a hairbrush down the toilet.

[Plane]

   All true ,but for a large number the big "investment" is the home.

    Government involvement in this decision can and has facilitated disaster.

[Xavier_Onassis]

The mortgage interest deduction benefits the rich guy with two homes more than it benefits the average citizen.
When I bought my house in 1977, I was told that I should buy the most house possible, go for broke, because it was such a great deal.
I told the real estate clowns that I has $5 tops to put down, and that a was not interested in anything about $30K. They told me that there were no such houses, and everything they wanted to show me started at $35K. I offered $29K on about three of them and pissed them off.

Eventually, I assumed a mortgage on a house for $26K with a small rental apt. attached, paid no commissions, paid minimal closing costs.

The real estate clowns were incompetent ninnies. Not one could bother to tell me the square footage or any house or lot or the school district. Of course, they all knew someone who would give me a mortgage, because they got a commission on that too.

The average American believes these clowns, thinks they are experts, and gets screwed.

My point is that the mortgage interest deduction often serves to enslave the average middle class person into paying more than he has to.

[Plane]

The mortgage interest deduction benefits the rich guy with two homes more than it benefits the average citizen.
When I bought my house in 1977, I was told that I should buy the most house possible, go for broke, because it was such a great deal.
I told the real estate clowns that I has $5 tops to put down, and that a was not interested in anything about $30K. They told me that there were no such houses, and everything they wanted to show me started at $35K. I offered $29K on about three of them and pissed them off.

Yes.

It is generally a good rule to learn the ropes and shop around before a major purchase.

Eventually, I assumed a mortgage on a house for $26K with a small rental apt. attached, paid no commissions, paid minimal closing costs.

The real estate clowns were incompetent ninnies. Not one could bother to tell me the square footage or any house or lot or the school district. Of course, they all knew someone who would give me a mortgage, because they got a commission on that too.

The average American believes these clowns, thinks they are experts, and gets screwed.

My point is that the mortgage interest deduction often serves to enslave the average middle class person into paying more than he has to.

     That is a good point.

       It is a cousin to the point that I wanted to make.

         The governments policies have been a part of this picture, on the side of more people buying more houses.

[sirs]

       It is a cousin to the point that I wanted to make.

         The governments policies have been a part of this picture, on the side of more people buying more houses.

BINGO.....which is cousin to the point this whole thread is about....POLICIES generally implimented by DC, partciularly by liberal politicians, designed to make people more dependent on Government, and thus perpetuating their growing power, at the expense of the tax payer, especially the middle class

[Xavier_Onassis]

The mortgage interest deduction goes back to the 1950's, and the GOP was as much in favor of it as the Democrats. The ostensible goal was to stimulate the construction industry and put a lot of the soldiers who came back from WWII int construction jobs. The GI Bill also removed a lot of them from the job pool, since they were attending college. It was a good idea at the time. But it seems that it is not as good an idea in 2014 as it was in 1946.

[Plane]

   Some bad ideas get bi-partisan support.

    I don't remember anyone being in favor of reforming Fannie Mae before 2008.

     In hindsight the collapse seems like an inevitability.
     Foresight is much more quiet.


       I guarantee you there is something now building to an inevitable failure, but I couldn't say what exactly, it will seem pretty obvious afterwards, always does.

[Xavier_Onassis]

The stock market and the economy, will always go up and down.
It will not remain stagnant for long.

My goal has been to be invested in the things that are appreciating the most, and avoid those that are depreciating ot appreciating ;less.

Best investmanrts have been SSHFX, JAGLX, and DODGX.

Up and comers seem to be VWO DSEFX and QQQ

[Plane]

   I can't invest in something without understanding it.

    The few stock I have invested in I chose because I understood the product, unfortunately for me there is a lot more to it than that and I have not done well.

     I am invested a lot in the TSP, which is a lot like a 401k. This is mostly an indexed fund that has mostly done well.

     I like land and though I have mixed success with renting , I have high hopes , but I am aware that I am taking high risk.

[Xavier_Onassis]

Well, good for you.

I prefer mutual funds, because the returns are better.

The fund adviser understands the businesses for me, and provides diversification.

The newsletter I subscribe to  evaluates the funds on an ongoing basis.

TSP owns a lot of businesses that you probably do not understand, by the way. It is far from a poor investment.

[Plane]

  The TSP makes me dependent on the decisions of others.

    This is a weak complaint because what I have more direct control of has not done as well and I give most of the TSP contribution voluntarily to benefit from the matching funds and tax break.

     

[Xavier_Onassis]

I give control to the managers of mutual funds and those who write my newsletter, because they have demonstrated over many years that this combination produces the growth of my money that is the goal of my investing. It is like giving control of the pilot of an airliner to move me safely 800 miles in 2.5 hours.