Thursday, December 06, 2007
After the much hyped surge in real estate appreciation the last several years, there has become a renewed expectation for return on real estate investment. I find it similar to the hype surrounding internet stock in the late 90's. With all the excitement and media frenzy, a sense was created that the internet was a great way to get rich quick. Unfortunately, the reality that investment is related to more than media hype eventually settled in. The same holds true for our recent real estate market. We all saw unbelievable appreciation in our homes - and it was great! The reality, though, is real estate historically appreciates at an average rate of 6% a year. As a comparison, the stock market historically returns 10% a year on investment. Anyone strictly looking at a home as an investment is better off putting their money in the stock market.
That cynical view assumes that a house is just a commodity that we trade like stock - but it isn't. A house is so much more than that. A ...
| Posted by Joe Atalla at 3:28 PM |
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