Quote:
Originally Posted by Slava
Hey, I own a house as well, so I'm not saying people shouldn't buy houses. I'm just amused that Rerun thinks that buying a house is amazing as far as investing goes. A return of 3.5% compounded annually, and taking into account the enormous jump in housing through the 2000's isn't anything to write home about.
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You'd have a hard time finding someone more pro real estate investment than me, but I don't see owning a personal residence as an investment. Sure, it'll eventually be paid off, but if you'd rented something comparable and saved and invested the difference you'd be just as well off. This is more true on larger houses where the rent wouldn't cover the mortgage/taxes/insurance on a comparable house. If you're comparing buying versus renting a small condo or townhouse the numbers work differently.
IMO the big benefit for most people is they'll defer their savings for a trip or a new car, but the mortgage payment doesn't get skipped. So since the principal portion of the mortgage is savings they're forced to save.