[tc-sacto]

Originally Posted by red-beard

I'll give another take on this. You stated 6.5% growth in the value of the home. Where are you getting that number? 6.5% is above the PRESENT inflation. It is also way below what I'm expecting for inflation in the next several years.

6.5% derrived from California Realestate Association
1968 median family home price $23,210
2008 median family home price $285,680
over 40 years = 6.5% growth.
At 6.5% growth, I see the house going to even at 7.5 years.

If inflation hits 10%, it will take a bit over 5 years for your loan to not be "underwater". Is the loan a fixed rate loan? Don't know

I am expecting inflation to hit, and hit hard in 2010. We're still forcasting a very week European banking system. They will continue to lower rates to spur export growth to save themselves at the expense of their trading partners. Anticipate this to continue to support the $ and thus stave off inflation for a little longer....
Oh, and +1 with what everyone else said.

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