Quote:
Originally Posted by l2ridehd
Challenger is right on most items. The one he forgot to mention is leverage. When you purchase a 250K home you put up 50K. A 10% return on home value over 5 years turns into a 50% return on invested capital, or 10% per year. So factor that into your calculations as well. This does not work for everyone. It takes time, hard work, and dedication to be successful. You have to look at all aspects, be willing to accept the risks, and be willing to work at being successful.
hummmmmmmmm, seems like that is the case with all investments.
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I do agree and on the other hand a 20% reduction in value on the $250,000 property would provide a 100% loss of your $50,000 equity investment. I used to think that such a thing was impossible-not anymore. Leverage is a two edged sword as many foreclosed homeowners will tell you.