The house is sold, but it's not enough to pay off the loan, should I sell it or not?

This was a comment from a friend last Monday, and in fact I’ve received many similar messages, which is “If the money from selling the house isn’t enough to pay off the bank loan, and I have to put in extra money myself, should I still sell or not?” Let’s think more rationally: the money you owe the bank has nothing to do with the house. The bank only has “foreclosure rights” in extreme cases, but this loan is just the most common type of money you borrow from the bank—whether you sell the house for a big profit or not enough to repay the loan has no meaningful comparison. It’s like “whether I go to the mall today to buy a piece of clothing depends on whether I earn more or less than a certain elementary school classmate”—such comparisons are absurd. But because this loan is called a “mortgage,” we naturally think they are related. This is a misleading name; it easily leads people to misunderstand as “house debt,” but that’s not the case. Once you understand this concept, you’ll know the answer: regardless of whether you need to put in extra money or not, if you think the house will still fall in value, then you should sell it. It won’t become more valuable in the future just because you owe more debt or don’t sell now—it’s actually very unlikely to appreciate further, and you’re also continuously incurring costs without realizing it. I’ve said before, even if a house is for personal residence, it’s like paying rent—because your living in it is a consumption, which is equivalent to sacrificing the risk-free return you could get from the house’s market value. For example, if your house is worth 20 million yuan, and the risk-free interest rate is assumed to be 1.5%, that’s 300k yuan. Living in this house is like paying a rent of 25,000 yuan per month (actually more, including property fees and other costs). The key here is opportunity cost: holding any “asset” essentially costs at least the risk-free rate. People with higher financial returns have higher opportunity costs. So whether you hold a house or other assets, you must “pay rent” continuously. This rent is your holding time cost—the risk-free interest you give up to hold it. Whether you’re losing or gaining, you’re paying it continuously. Second, if you’re still losing money, I’ll call that loss the “cost of seeing the cards.” What does that mean? It’s like in poker—you think you can still win, so you don’t want to fold, and want to see another card. You need to spend money to stay in the game. If the final outcome isn’t what you hoped, then you’ve paid this risk cost of seeing the cards—it’s necessary, but only if several conditions are met: first, the cards are favorable to you; second, the cost of calling and seeing the cards isn’t too high; third, the pot is big enough. Under these conditions, losing by calling is normal. But if not, for example, the real estate market has been poor for several years (I’ve been saying this for years), and even if you buy in, the upside is limited, and you have no advantage over others in this field. Now you realize this, but because of sunk costs, you can’t react, and you’re passively calling and seeing. Even if you win by luck, you’re just a gambler, and gamblers are doomed. Folding is an integral part of the game; no one can keep calling on every hand. When it’s no longer cost-effective to keep calling, just fold and move on—it's all about the overall account. What’s the biggest fear? Someone plays one hand, puts all assets into the house, and if the house fails, they’re finished—that’s “unbearable loss.” And “unbearable loss” often means the person has already lost because they’ve lost the strategic choice, and can only gamble blindly. It’s like sending yourself to the slaughterhouse and handing the knife to others. #TradFi交易分享挑战