I did. It’s extremely rare for real estate to decline in value, and walking away from the property is always an option if it has (or a short sale, which is must less detrimental on your credit).
Even if it were true (and it's not[1]), the topic at hand is a hypothetical case where "your house ends up being less than you bought it" and that's what I was directly replying to. If you lose money on the sale price is (almost certainly) not even close to the amount of money you have to spend just to own the house.
[1] I personally know at least three people who sold houses for less than the bought them 7-10 years later. My parents have owned their house for 25 years and while the dollar value went up it hasn't kept pace with inflation (recently got three appraisals) even though they have cared for it and even added an extra bathroom.
> It’s extremely rare for real estate to decline in value
You and I must have very different ideas of what the word "extremely" means.
> walking away from the property is always an option
That is only true in twelve states. In the other 38, the lender can sue you to recover the difference between the house's value and what you owe even after they foreclose.
The mere fact that you are looking at real estate as an investment rather than as a place to live indicates that you have far more financial resources than a typical person. For a typical person it is not a realistic option to discard their entire social network and move halfway across the country just to get some more favorable mortgage laws.
You don't have to live somewhere with non-recourse mortgages. To get started, you only need 3% down, an FHA mortgage, and a 4-plex that cashflows slightly. You then eventually refi that with something more conventional and move on to your next property.
Real estate is only one investment vehicle where you don't need a large amount of capital to realize substantial cash flows. Whenever possible, seek out leverage opportunities.
You don't get to choose where you are born or grow up. You are effectively suggesting that people move a thousand miles away from every single person that they know just to get more favorable mortgage laws. That is not doable without starting from a position of privilege.
As investment, you don't actually have to live where you are buying. I have a relative 2000 miles away that buys condos in my city as investments. My wife researches them, reports back and they make a buying decision. There's a favorable situation here and they're taking advantage of it. Not by 'privilege'; by smart investing.
If you can afford to buy a house that you aren't even living in, you have far more financial resources than the vast majority of people. You seem to be completely deluded about how much a normal person can afford to put into investments.
The average person probably shouldn't be buying investment properties anyways. Running income producing properties is more of a part time job than anything else. It takes significant effort to find the right property at the right price with the right renovations in order to make a good profit. Unless you're really willing to put in the leg work (and usually the "sweat equity"), you're better off putting your money in index funds or REITs. It takes the right person to make money in real estate.
I've known several people who wanted to "get into real estate" so they bought duplexes and became landlords. All of them lost money or broke even because they went into it without doing their due diligence. My parents ended up just walking away from their "investment" property and declaring bankruptcy, that's how much they lost out. It isn't buy property -> profit like people think.
Leverage cuts both ways - it magnifies both gains and losses.
