The Rebuttal To The Blah Blah Blahs

Although some might try to knock down real estate as a proper investment, it helps to consider what the experts are saying.

Housing is overrated as a financial investment. Blah blah blah.

Since many people have trouble saving and have to make a housing payment one way or the other, owning a home can overcome people’s tendency to defer savings to another day.

You can hope that your house will accumulate in value but don’t count on it. Indeed, you should expect that as an investment your house will appreciate less than does the stock market. Blah blah blah.

Homeownership allows households to amplify any appreciation on the value of their homes by a leverage factor. Even a hefty 20 percent down payment results in a leverage factor of five so that every percentage point rise in the value of the home is a 5 percent return on their equity. With many buyers putting 10 percent or less down, their leverage factor is 10 or more.

You didn’t expect to get a great investment and a place to live in the meantime, did you? Blah blah blah.

Homeowners pay debt service to pay down their own principal while households that pay rent pay down the principal of a landlord. Homeowners are able to deduct mortgage interest and property taxes from income…On top of all this, capital gains up to $250,000 are excluded from income for single filers and up to $500,000 for married couples if they sell their homes for a gain.

The rebuttals to the “blah blah blahs” come from Eric Belsky, the Managing Director of the Joint Center of Housing Studies at Harvard University.

We also feel that homeownership makes sense for many Americans for an assortment of social and family reasons. It makes sense financially too.

Call Skyrise Real Estate Group at 408.634.3473 and find out why Silicon Valley continues to turn to us for real estate solutions that work.

BRE: 01338047