Sorry. I didn't mean to seem harsh. Quick jumps can be very hard on some people. 340k to 150k is very big. But I do think these are more end cases then it seems. The point to note is this:
I" want to sell that house and move somewhere else."
In the majority of cases, people want to buy at a higher price. Even if they want to buy a cheaper house, you lose the difference between the house prices at the time you buy, the price at the time you sell (buy again), times the rate at which house prices fell. Say you go from a 300k house to a 200k house after a 25% fall (big numbers), you "lose" $25k. If you move to a more expensive house, you "win."
If your house is under water, you are in no worse a situation really then if prices hadn't crashed. You still have the same mortgage.
When you buy a house you lock in your housing costs.
Comments
Sorry. I didn't mean to seem harsh. Quick jumps can be very hard on some people. 340k to 150k is very big. But I do think these are more end cases then it seems. The point to note is this:
I" want to sell that house and move somewhere else."
In the majority of cases, people want to buy at a higher price. Even if they want to buy a cheaper house, you lose the difference between the house prices at the time you buy, the price at the time you sell (buy again), times the rate at which house prices fell. Say you go from a 300k house to a 200k house after a 25% fall (big numbers), you "lose" $25k. If you move to a more expensive house, you "win."
If your house is under water, you are in no worse a situation really then if prices hadn't crashed. You still have the same mortgage.
When you buy a house you lock in your housing costs.