What is the right way to look at numbers?
Hello,
If I own a single family home for my own personal use with PITI = $3000 and if $1000 of PITI
goes into principal payment, is it safe to consider my effective monthly real estate expense is $2000 and the other $1000 as a forced saving?
Thanks
Most Popular Reply
Joe Villeneuve
#5 All Forums Contributor
Pro Member
#5 All Forums Contributor
- Plymouth, MI
No. It's a $3000 cost. You're taking cash out of your bank (liquid), and putting it into the floors of a house (solid). All you're doing is transferring that money from one location to another, except when it's in the bank you have a choice of where it goes next. When you choose to put it into the floors of a house, you've made that choice. It's not different than buying a car...or anything else for that matter.