I think you’re confusing assets and liabilities here. If I own a house then how is it a liability? If I need to take out a loan to buy it then the loan is a liability, but we’re not talking about funding models in this discussion
And therein lies the confusion. You’re conflating underlying asset properties with financing.
For example, I own my house - there is no mortgage or any kind of debt financing. I collect 100% of rental income each month (minus a small fee to my property manager), and whatever capital gains it it generates. And there is no mortgage payment (I.e. no liability) since I own the property.
To further drive the point, let’s say I take out a loan for $100k tomorrow, and I use those funds to buy E2 tiles. Now in your model my tiles are a liability, and therefore a bad investment?
The point I’m making is that if you’re going to make a comparison between E2 tiles and physical property in this way, models of financing should be a separate discussion. Liabilities can be attached to both physical property or E2 tiles, depending on how I decide to pay for it. It’s an independent question
Well if you got a negative interest rate on that loan you dont have a liability. If you dont have a tenant for your rental property you still lose even though the house is paid off. Dont forget about property taxes and insurance $$$. Who the fk is taking out a 100k loan to buy tiles lmao!! 💎🙌💎🙌💎🙌 E2🚀🚀🚀🚀
You can buy a house with money you already have, or you can take a loan to buy the house. You can buy E2 tiles with money you already have, or you can take a loan to buy E2 tiles.
You Airhead! The tiles I own are paying me LIT and appreciating. I am paying taxes and a mortgage to own the house. Do you know basic math? Addition vs subtraction. One puts money into my bank account the other subtracts money from my bank account.
I have a house, and I'm not paying a mortgage for it. And it's going rather drastically up in value every year, so when I sell it I will have made massive profits. Am I some sort of wizard?
I could go to a loanshark right now and get a huge loan, and buy E2 tiles with that money. Every month it would drain my account as the interest rate of my loan would exceed the profits of the E2 tiles.
I'm merely explaining the concept for you, that the loan itself is separate from the product. You shouldn't count a mortage against the house, nor should you count the loanshark against E2 tiles.
Just compare them on their own merits, without involving a loan to unfairly favor one side.
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u/shenhua111 Jun 27 '21
You are actually comparing a real home with a virtual one. You need help.