9 responses

  1. maria@moneyprinciple

    Strictly speaking, a house is always a liability if you live in it – it takes money out of your pocket. And this doesn’t depend on whether you own it or not. The only way to make it neutral is if you manage to cover the costs of living in it by having lodgers – which is a pain for a family if the house doens’t have a separate part of it that is de facto an apartment.

  2. Financial Samurai

    What do you think the average house size is in urban cities in Australia? In the US, they are averaging around 2,500sqft now from 2,000, 20 years ago.

  3. John@MoneyPrinciple

    @Shaun – congratulations on your new arrival!

    But @Sam I think the average size in the UK is reducing, not increasing! Developers (those who haven’t gone under) put more and more houses on smaller and smaller plots. I guess we just don’t have the space! But smaller houses are cheaper to heat and it means that you spend less petrol going round the block to your friends!!!

    • Money Cactus

      Thanks John!

      The average land size here is reducing (anywhere between 3500 – 5000 square feet of land is common these days, but the house size has probably increased with modern living. Everyone want 3-4 bedrooms, multiple living areas and multiple bathrooms. As a result, most newly built houses have very small backyards.

  4. Van Beek @ Stock Trend Investing

    Yes, this often quoted misconception of “your house is your biggest asset” is often taken out of context and used as an excuse to buy a too big house. In the days that banks were careful with giving out mortgages and people had to pay off every month a part of this mortgage for 20 or 30 years, buying a house was like saving. It helped/forced people to save money and create their biggest asset. Nowadays, the too large and easy mortgages are not a help anymore but an obstruction to reach a degree of financial freedom.

  5. Elizabeth @ Broke Professionals

    Yeah, there’s no way I’d rent my basement – or any part of my house – to anyone. I have two young children – talk about a liability? Someone I barely know sharing my four walls.

    By the way, Shaun, congrats on the new addition! It seems like just yesterday I had my second child – now my baby boy is two weeks shy of a year! Those late night feedings and sleepless nights will go by fast :)

  6. Simple Finance Blog

    I’ve never viewed my mortgage as a liability – after all, it usually costs more to rent a property than it does to pay the mortgage (escrow included) on it.

  7. Credit Counseling

    I’m always amazed how many young families are struggling to keep up with mortgage payments on their 3000-4000 s.f. house and yet refuse to rent out a basement.

  8. Tom@easyfinance

    Personally I feel for a house not to let it be a liability, one should go for renting a part of it. Otherwise the amount of money that gets wasted for the maintenance, makes the attachment and passion for self home go down the hill. Superb article nevertheless.

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