Since time in memorial, people have been considering their home as an asset. However, such notion is being challenged by a relatively new school of thought that insists that your home is a liability. The man behind this unique way of thinking, Robert Kiyosaki, strongly believes that an asset should be viewed as something that puts money in your pocket. And in relevance to this outlook, one may therefore claim that owning a home (not renting) is a liability and not an asset.
However, like any other blossoming school thoughts, Kiyosaki's notion of 'home as liability' was not made known without any form criticism. For according to some critics, a home is an asset if you would be viewing it from a financial perspective. Luke Landes with his consumerism commentary pointed out that "a house, like any other object that comes into your possession, is classified as an asset. An asset is something you own. A house has a value. Whether you assign the value as the price at which you purchased the house or the price at which you believe you can sell the house, that amount is how much your house is worth."
From a financial standpoint, liability in its broadest sense is anything that puts an individual at a disadvantage. And this legitimate definition somehow reechoes the teaching of Kiyosaki stating that a "liability is anything that takes money out of your pocket," in sense putting you in a disadvantage. In a more concrete form, a house, even if it is paid off would still be a liability because of the taxes, insurance and other expenses intended for home maintenance.
Having presented the two diametrically opposed concepts of asset and liability as applied to owning a house, one could say that both are correct in certain perspective. A house could be considered as an asset due to its value and its potential for making money in the long run through appreciation. However, as recognized by Landes himself, if your ownership of the house prevents you from using your money for better things and purposes, then you might therefore claim that such property is indeed a form liability in the broader sense of the word.
