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A second look at wealth building schemes based on real estate acquisition.

I totally disagreed with Mr. Bach’s suggestions that everyone should buy a home. He quoted a study that showed the homeowners have more than 30 times the net worth of renters. So, are homeowners wealthy because they own a home or do they own a home because they are wealthy? I doubt there is a causal relationship between the two. At any rate, it is a bit irresponsible to suggest that someone in a lot of credit card debt and very little in savings (Mr. Bach’s primary audience), buy a home with nothing down, mortgage themselves to the hilt, pay a premium on prevailing interest rates and pay the maximum private mortgage insurance at a time when real estate prices are expected to soften.

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