Pretty much by chance, I came upon the Zillow page for the first house I ever bought, back in St. Matthews (i.e., suburban Louisville) KY in 1965. I paid $13,900 (and felt the realities of adulthood crashing down on my shoulders, believe you me). An inflation calculator translates that to $99,693 in today-dollars. The Zillow estimated price is $163,600. That pencils out to a real-dollar return of just a shade over one percent a year.
No moral, just reporting.
3 comments:
Doesn't seem like a huge return. Did you factor in the imputed cost of not paying rent for 45 years? (and after the mortgage was paid off, roi on cash put to other use?) Might at least put it on par with other conservative investments.
i lived in the same neighborhood back then but i rented. nice neighborhood. in the fall everybody would rake their maple leaves into huge piles in the street and almost like a prehistoric ritual everybody would burn them on the same night. you drove home through clouds of smoke. a presbyterian church out there in st matthews was the hotbed of goldwaterism. would make today's tea partiers look like innocent babes when it comes to political virulence.
One percent is, after all, at the high end of most sober long-term estimates for real estate. I've seen zero and I've seen .8 of a percent come out of studies looking back over a hundred years. As Taxmom intimates, real-estate-as-investment is all about the rent, not the resale.
Post a Comment