St. Maximos' Hut

Psalm 14 The Virtues of Capital
4 Where there are no oxen, the manger is empty,
but from the strength of an ox comes an abundant harvest.

I read this passage as a warning to those who might fear investing in capital because it will require upkeep. Wise investments (oxen) generate a stream of benefits (feed) that help sustain the value of the investment.

Like most american's, my biggest investment is my home. My wife and I sometimes feel like we are living to "feed" it. Any ideas about how I can get it to feed itself? Or should I admit that its a consumption expenditure (in which case, why not go back to renting)?
Posted by William Clark on Wednesday March 14, 2007 at 7:58am
Randal Verbrugge (mail):
I think there are several issues. It is almost always cheaper to obtain a given level of housing in the US by purchasing. If you use government schools (and to a lesser extent if you don't), the housing decision is joint with a school decision. (It is also joint with peer groups, crime, commute time, etc.) In terms of investment, housing is risky and its main return over the long run is in the form of shelter "dividends" (you could be lucky or unlucky, of course). In terms of impact on pocketbook, with a fixed-rate mortgage you perhaps pay more for housing now, but less later.

The more difficult question, of course, is choosing a level of consumption of housing. Every dollar spent on the mortgage (or upkeep) is a dollar less for the kingdom.

I welcome your thoughts.
3.28.2007 1:45pm

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