If real estate values don’t increase, it’s a bad idea.
Why not take a risk living on a mountain top in a cheap trailer, and investing your money in a helicopter for your daily commute to you’re ivory tower job? At least it would be more fun and exciting.
>> If their income goes up <<
And what planet would that be on? We have 90 million Americans not even generating an income, and 47 million on food stamps.
Other than short term fluctuations, real estate values only go down in areas that have obvious economic flaws. If one chooses to live in such a place or buys property at the top of an inflated bubble, then the cost vs. benefits of a mortgage are the least of their concerns.
My income has gone up every year since I turned 16, and it’s grown by an average rate of 7.3% over the past 25 years through promotions and finding higher paying employers working in the public sector. My younger brother is a software engineer whose income has gone up every year by double digit percentages. My older brother is an airline pilot whose income has gone up every year at a higher rate than mine has. These are anecdotal so let me give data:
Average wages for every worker in the US have gone up faster than inflation. https://www.ssa.gov/oact/cola/awidevelop.html
If one is an average worker, then the average wage increase they receive every year is about 3%, the average mortgage interest rate after taxes runs about 3%, so there is zero penalty to buy a house of constant value using a mortgage.
If you factor in the savings on rent (which has been increasing faster than inflation), then a mortgage becomes a much better deal. If the home then ends up appreciating at the conservative rate of inflation only it becomes an almost unbeatable deal. If you buy a house in a rapidly developing area, then it becomes a screaming deal. http://observationsandnotes.blogspot.com/2011/06/us-housing-prices-since-1900.html
My house has gone up only 63% in value since I bought it in 2002. My mortgage payment including principal is now less than what I would pay to rent the exact same house in my neighborhood.
By the way helicopters depreciate in value and upkeep costs grow over time, a perfect example of a poor piece of property to purchase on credit.