Quote:
Originally Posted by ranchlandsselling
I get what you're trying to say but it doesn't really make any sense.
Okay, let's say over the next 5 years the $500 k house drops to $275 k and you can only amortize 25 years if you put 5% down. If I was in the situation I'm in now I'd buy the most house I feel comfortable affoarding now and in the future. If the $500 k house is now $275 k I'm buing the $450 k house that used to be $700 k. I'm not instead spending the money in the mall on stuff?
Are you providing statistics that show the multiplier on a dollar spent in malls has a greater effect on GDP than a dollar spent in a house?
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Makes perfect sense to me. You could afford a better house and it seems like you will always go for the most you can afford.
700K house - DP of 5% = 35K. Mortgage of 665K
450K house - DP of 5% = 22.5K Mortgage of 427.5
Even if the payments are the same due to interest rates, you always go for cheaper.
It's always about the principal, not monthly payments.