Getting Real (Estate)

[lookout123]

Originally Posted by smoothmoniker

It's a home, but it's also your primary savings and investment. That's a big part of why my wife and I are stretching so far to get into this house. We feel like it's the best leveraged investment we could make right now.

/devil's/While that is traditionally true, have you considered the effect of the baby boom generation on this traditional strategy? Every boom/bust cycle we've experienced since 1945 has been directly tied to the habits and needs of the boomers. As boomers age they will downsize. In many cases they owned second and third properties as investments. They will sell these properties as the need for cash comes along combined with their diminishing desire to have the extra concern of multiple properties. There are nowhere near enough buyers for all of the existing properties + additional properties as the builders continue to do what they do. Home prices cannot not escalate the way they have traditionally. The home as primary investment just might not work for our generation the way it did for our parents./advocate/

Also, we really, really want to live there.

Now that is a perfectly respectable, legitimate reason to purchase a home.