Historically, the value of owner-occupied homes has risen at a fairly low rate, one that pales in comparison with the performance of stocks and bonds. Between 1975 and 2008, the price for houses of comparable quality and size appreciated an average of about 1 percent per year.”
We’ve probably had 2 little bubbles and one big one in that time period and if you sold at peak and bought low, you probably made more than 1 percent. Even if you didn’t sell during the smaller bubbles and sold in 2005/2006, you did fine. Long term doesn’t have to mean your entire life, but holding 30 years in this scenario would have given you some nice gains.[/quote]
Depends where you were. Nationally, Housing hasn’t done well, that’s what the point of the case-shiller graphs are telling you.
Consider Dallas, Big Oil Boom in the late 70’s
hasn’t recovered since.
Consider Detroit, Nothing but downhill for 30 years.
Consider Chicago. Not much gain, My Dad sold a condo on the lakefron in 1977 for 250K, same unit
sold 32 years later for 350K. 40% gain over 32 years?
Historically Real estate has gone up 4%, but inflation has been 2.5% so, it’s not much of a gain.
Now is real estate a steady savings plan? Sure.
Does it give you some control over your destiny?
Sure.
