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To: CalculatedRisk who wrote (34548)	7/30/2005 10:46:44 AM
From: Tommaso	Respond to of 116555

>>>Most people just think in nominal terms. In nominal terms, house prices nationwide are up 435% since 1976, but in REAL terms they have only increased 69%<<< 69% real return is a pretty good increase for an asset that is simultaneously providing shelter. When you consider the rental value of an owner-occupied home, the "income" is huge. Not bad for a structure that just sits there. The example I gave specifically allowed for inflation. To say these things is not to argue that buying a house NOW is a good idea. But because real estate has, on the whole, been an excellent investment for most people for most of the last 50 years, the popular unwisdom is that buying a house is a good idea no matter how much it costs and no matter what kind of mortgage you get.