Originally Posted by SteveZ

We talk a lot about "choices," but the reality is the discussion is about "risk."

When we buy property with the idea that it will always increase in value, so the debt-to-equity ratio at time of purchase doesn't matter, that's a risk.

Where I grew up (in Boston) I can remember houses in the '60s and 70's where the value tanked and folks lost money. It happens.

Where I work and have a house (outside DC) the house I'm selling will result in an over-$100K loss from the original purchase price. My friend who came to DC with me chose to rent instead of buy. In the end, his overall housing costs will be much less than mine. It happens.

Friends who have "invested" (high-class word for "gamble") in stock, mutual funds, etc. which were to provide a rate-of-return higher than the run-of-the-mill savings account ignored the disclaimer that there is no guarantee now have paper-property worth much less than the amount "invested." It happens.

It's a tough fact of life that there are no guarantees in this world when it comes to money, value of property, profits to be made, or catastrophes (physical or financial). The younger the person, the greater the tendency to consider yourself immortal and/or immune to harm. The older the person, the greater the tendency to believe they are better-the average at assessing risks and good gamblers, and the mutual fund salesmen live on that perception, as do those who build casinos (who are their most frequent customers?) - as well as all of those credit card companies who flood mailboxes with "great" opportunities.

It's a shame that life can't be a rosy path to greater security, prosperity, property, et al. There's a lot of potholes and speed bumps on the path.

It's a jungle out there....