Tracking Primary Residences

[Leo Bolta]

Adrien, thanks for posting your recommendation again, as I did not see your
original post due to my mix-up in signing up to the email distribution list.
I've now tried implementing as per your recommendation, by treating the
unrealized gain as an equity rather than income and it worked out great!  My
charts now look normal and the valuation fluctuations only showing up in the
Balance Sheet. I plan to run conservation updates on resident property
valuations maybe once a year, at about 3/4's the "ball-park" value just to
stay on the conservative side things. 

Best regards,

Leo  

    

-----Original Message-----
From: gnucash-user
[mailto:gnucash-user-bounces+lbolta=rogers.com at gnucash.org] On Behalf Of
Adrien Monteleone
Sent: June-26-17 11:21 AM
To: gnucash-user at gnucash.org
Subject: Re: Tracking Primary Residences

Leo,

As I noted in the original thread you posted on this topic, unrealized gains
should not be an income account, it should be an equity account. It should
not reflect on your income figures or mess with your graphs at all.

When you actually sell and have a firm valuation, then you can convert the
unrealized gain into a realized gain, which IS an income account.

The only 'traditional' report you should see Unrealized Gains on, is the
Balance Sheet in the Equity section.


Regards,
Adrien

> On Jun 25, 2017, at 9:13 AM, Leo Bolta <lbolta at rogers.com> wrote:
> 
> 
> Although I understand it does not seem to be standard accounting 
> practice to track appreciation on a condo which is a principal 
> residence, I can't help but want to implement incorporating very 
> conservative periodic values into GnuCash, possibly as much as twice a 
> year as the condo represents a considerable percentage of my net
worth/portfolio.
> 
> My attempt at treating the condo as a fixed asset with an unrealized 
> capital gain aspect was to incorporate the set-up as per 'Example 11.3 of
Chapter
> 11" in the GnuCash manual.   However because of a quite a hot
> real-estate/condo market, my unrealized gains are now so significant 
> that the previous unrealized gain dwarfs the fixed income amounts to 
> the point that the bar charts such as "Income/Expense Chart" displays 
> a skyscraper sized income bar in the graph, next to a very miniscule 
> bungalow sized bar representing my expenses. Prior to implementing the 
> new set-up, the Income vs. Expense chart was much more meaningful as a 
> gage to monitor tangible income against real expenses. I've even tried 
> taking the total bi-annual gain and evenly distributing the total into 
> the past six months but the reports still don't have the meaningful
representation it once had for me.
> 
> Because the condo is my principal residence which I don't have any 
> intention of selling anytime soon, is there a way to account for 
> periodic appreciated values, without it effecting income in such a 
> profound way when the gains are in reality mere paper gains? I am also 
> not so concerned about the eventual capital gain, since the sale of a 
> primary residence are not treated as a taxable gain here in Canada.
> 
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