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Originally Posted by NorCalAthlete
As I shop for a house I'm meeting more and more people who swear they'll never buy a house because their investments pull more than a house would appreciate, or because it's just too much of a hassle, whatever.
I'm pretty set on having an asset I can rent out if need be, that is highly likely to appreciate by a 6-figure amount, in a desirable area, so I can have my own garage for my car and do what I want with the place without worrying about losing a deposit or whatever.
How about the rest of you? Do you own? Rent? Rent for now but plan to own when able?
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NorCalAthlete NorCal real estate is a distorted cartoon, because of its high price appreciation. compared with the rest of the United States.
Most places in the US do not see price appreciation that beats an actively managed equity portfolio, or even a passively managed one, over any appreciable time period.
My conclusion after 25 years of home ownership is that the primary dwelling is an expense, not an investment. Whether one owns or rents, the end result remains - it's an expense. I have done dozens of analyses on this.
Owning a home often gives the owner a higher quality experience, generally for raising children. This can mean higher property taxes to pay for higher quality public schools, with higher income neighbors and more yard and living space. The benefit in this scenario is a higher quality experience, not a better net present value outcome.
I haven't met one person that is married and has children living full time with parents, who have flipped their primary dwelling multiple times in a manner to deliver a financial return that exceeds a passively managed equity portfolio.
Summary: real estate doesn't return what an equity portfolio can return. Northern California may be one of very few exceptions to this.