It's also how you look at it. If I buy a house that is 800k I will have little left over every month after paying the mortgage. So I will feel poor. It does not matter if that house goes up in value. I still have the same amount left after making the payment. I could not go out to eat very often or take nice vacations or buy big flat screens or even play nice golf courses. Now if that house drops to 600k and I buy it, I will have a much better quality of life. I will be able to spend that extra money on my leisure activities. I will feel richer! I'm hoping it drops to $400k, then I can play a few rounds at Pebble Beach 🙂
I definitely "felt" richer when I was fresh out of school on my first job , renting a condo $660/month in LJ making $45k/year back in 96 than I do now, with a $5000/month house obligation (mortgage+tax+insurance+melloruse+utilities) and $1500/month childcare though my salary are a couple of factors above what I was making. I don't feel "rich" at all. Oh well. Time tap my heloc
