Thank you for sharing your thoughts Jason.

I completely agree that one should buy a "reasonable home for a reasonable price," the problem is that different people define "reasonable home" and "reasonable price" differently. I might want a home large enough to host my adult kids plus significant others for a week, while you may want a compact two-bedroom apartment.

Reasonable here depends on your needs, goals, and priorities. It also critically depends on your financial capacity. If you make $60k/year, buying a $500k home is borderline foolish. However, if you make $300k/year, a million-dollar home isn't much of a stretch.

I've heard many others make the same assertion as you do, that a home is a liability rather than an asset. I disagree. An asset is something you own (e.g., your home), while a liability is something you owe (e.g., your mortgage). Since most people who own a home have (or at least used to have) a mortgage, a home is usually an asset with a linked, albeit smaller, liability.

As I show here: https://medium.com/financial-strategy/if-youre-renting-your-home-you-need-to-see-this-1dd55f06dfa, on average a home is an asset that loses value after accounting for all costs of ownership (which I believe is why many erroneously call it a liability). However, that loss is miniscule compared to the cost of renting a similar home. In fact, my data show that if you plan to stay in one place for more than 2-3 years, unless you're very unlucky or have no idea about how to buy the right home, you'll more than break even compared to renting a similar home in a similar neighborhood.

The point I make in this current article is that mortgages provide several "tail winds" that make it a smart liability. You get the interest deduction, the interest is lower than almost any other loan, and most importantly - in the long run inflation helps you pay it off in ever-cheaper dollars.