With all the headlines circulating about home prices going up and going down (at the same time?) and the mortgage rate environment being in a state of flux, you may wonder if it still makes sense to invest in homeownership right now. A recent poll from Gallup indicates the answer remains “yes” for many. In fact, real estate was voted the best long-term investment for the 11th consecutive year, consistently beating other investment types like gold, stocks, and bonds (see graph below). Wondering... what can you really do with gold? That one has always made me scratch my head.
But, the bigger message here is that if you’re thinking about buying a home, let this poll reassure you. Even with everything happening today and all the contradictory media messaging, Americans recognize owning a home is a powerful financial decision. We at Imagine Marin group (of course) agree and have noted in past articles the tremendous advantages that derive directly and indirectly from home ownership.
Why Do Americans Still Feel So Positive About the Value of Investing in a Home?
Purchasing real estate has typically been a solid long-term strategy for building wealth in America. As Lawrence Yun, Chief Economist at the National Association of Realtors (NAR),notes:
“. . . homeownership is a catalyst for building wealth for people from all walks of life. A monthly mortgage payment is often considered a forced savings account that helps homeowners build a net worth about 40 times higher than that of a renter.”
That’s because owning a home grows your net worth over time as your home appreciates in value and as you pay down your mortgage. And, since building that wealth takes time, it makes sense to start as soon as you can. If you wait to buy and keep renting, you are missing out on those monthly housing payments going toward your home equity and losing out on appreciation (ask just about anyone you know who has been in their home (in Marin County, anyway) for 12+ years and they will tell you their is worth about double what they paid for it - even with the prices now being off their highs of early 2022.
Buying a home is a powerful, positive decision. If you’re ready to start on your own journey toward homeownership, connect with the Imagine Marin Group today. We are happy to discuss your options and help you get on the road to wealth creation - in fact, we are obsessed with it.