Your greatest investment, and your greatest albatross

Last year David and I pulled off a financial trick I thought we never would: Buying an apartment in New York City. There's a ton I learned along the way, and I've been meaning to write up the full story, as reference for those who are also taking the plunge and trying to decipher the cryptic process.

But there's a certain irony in finally starting to tell the story now. One of my closest friends called this afternoon to talk over a big financial decision: She's going to strategically default on her mortgage.

She and her partner bought their place right before prices peaked, at a time when they felt their only option was to buy a compromise "starter house" they didn't love or be priced out of home ownership forever. But right after they bought, prices started plunging -- and my friend lost her job.

With just one income and a significantly underwater house, they easily meet the guidelines for a loan modification, and my friend has applied for one, twice. But because they're still eking out the monthly payments and haven't gone late, the bank isn't interested in discussing a mod.

And my friend has had enough. Keeping up on the house payments means they have no money left for any kind of savings, including retirement savings; now, facing five-figure bills for needed maintenance and local housing market forecasts that suggest their house won't get back to the break-even point for another decade, she's decided to write off the sunk costs, let the bank come take its collateral, and move on.

Meanwhile, my best friend is also dealing with an albatross house -- one her soon-to-be-ex-husband fought to keep when they split, but couldn’t actually afford and promptly started missing payments on. Two years later, the foreclosure drama keeps dragging out.

I'm still thrilled beyond belief about my apartment, and this week I'll start posting the blow-by-blow tale of our 87-day warp-speed journey from making an offer to taking possession of the keys to our new home.

But my friends' stories are a sobering daily reminder of just how damn fraught the whole thing is.