To say this about remortgaging a house?

[SK82]

That if you own a house outright and you then take out small mortgage /s on it you end up losing value of your original investment regardless - it is not as simple as you just “ pay it back “. Please explain this more concretely for me.

I'm not sure I understand you. Suppose you remortgaged, but then used the money to pay the mortgage back. Then once you have repaid the mortgage, you are back in the same position as before you remortgaged, minus the total cost of interest, plus the value that the house has gone up in the meantime.

Obviously most people will initially spend the money, then use income to pay the mortgage back. Clearly if they never remortgaged or spent the money and instead made the same payments from their income into savings/investment they would be better off. But neither would they have whatever they spent their money on!

It's no different from taking any other loan except: usually lower interest rates ( so costs less), longer term (so costs more).

If you remortgage and invest the money (eg in another house) then you may end up better off, depending on whether your investment goes up faster than mortgage interest rates.

you end up losing value of your original investment regardless

I've no idea what is meant by this. If it helps, taking out a mortgage has no effect on the value of a house.

A loan costs you what you have to pay back, which due to interest and possibly fees, will be more than you borrowed in the first place. This is true regardless of whether or not the loan is a mortgage.

Taking a mortgage out on a house is just a way of securing a loan. You are no more or less well off than if you'd taken an unsecured loan, though you will probably have to pay less in interest.

All a mortgage really does is mean that it is easier for you to be forced to sell your house if you can't repay and means you can't sell your house and do a runner with the proceeds while you still have the mortgage loan outstanding.

Well, if you re-mortgaged and took the cash to spend in something that increases in value at a higher rate than the interest in the mortgage, you would actually be getting a better return on your initial investment.

Even better if the value of your house continues to rise faster than the interest you are paying in that cash..

I don't understand what you mean, and on that basis I suspect it is unreasonable

What are you hoping to do ?

No. Getting a mortgage doesn't reduce the value of your house. Maybe you mean something else, but it's really not clear.