Thursday, November 20, 2008

Underwater, Maybe. Drowning? No.

The Sun had a piece today on so-called "underwater" or "negative equity" mortgages in the area -- in case you're wondering, roughly 1 in 5 recently-purchased Lowell homes falls in this category (I suspect mine is included in the 20%).

For the record, I don't care.

I bought the place with very little down, have put very little into the principal (as you know, those first many payments are heavily skewed to the interest side), and the market hasn't exactly zoomed. So yes, I'm technically "underwater."

All of that means absolutely nothing to me.

I'll get a massive tax break this year for all that interest (plus, the first-time homebuyer benefit), I get all the personal, intangible benefits of ownership (could be fodder for an entry or two sometime), and I don't plan on selling anytime soon. While my stocks tank by the day, I'm slowly but surely building real equity and net worth in the form of my condo.

The article was fair -- far from being alarmist, it even mentioned that the "underwater" status is only bad for those looking to sell, struggling to make payments, or both.

Just an important thing to remember every time you see news headlines about this -- to some, it's a crisis, but to anyone who bought a home using the I-plan-to-stay-here-for-several-years-and-that's-why-I'm-not-renting rule of thumb, it really isn't worth crying about.

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