I paid all cash for a house once -- it was a huge mistake. You're losing the use of the capital to invest to make money and grow....
With interest rates this low anyone is foolish to pay off early or put too much down.
Think of it this way... I get a bit more than 4% in TAX FREE muni bonds... and a mortgage is less than that and you get to deduct the interest payments... so in actual fact you can make more money on your money than you're paying.
The 'key' to making a return - called ROI (return on investment) is to put down 20% -- say on a 500K house... so we'll call that 100K down.... if the house sells later for 600K -- you've doubled your "INVESTMENT" which was the cash you put down. Not bad... not bad at all.
If you pay all cash for the house -- 500K -- and sell for 600K -- you've only earned 20% on your money.
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