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4 reasons why treating real estate as an investment is wrong

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A friend called to say that they have just bought a house. That sent me into immediate panic. With two children in high school and college education just knocking at the door, is this the right thing to do, I asked him. But we love real estate, he said. Something I have simply failed to comprehend.

Don’t get me wrong. I have no problem with the desire to own the house one lives in. That decision is like insurance, provided the housing loan has been paid off. Even if a limb is lost, a job is gone, or bad times strike, the comfort of a roof over one’s head, the stability of a known location and the relief of not having to pay rent, are all precious. One house that one actually lives in is fine. That many find it unaffordable to find a home of their preference is another discussion.

My problem is with the attitude of treating real estate as an investment. An attitude that afflicts people across the income bracket. The middle class craves a second home;…

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