Owning your own home is still the best investment because it’s rent-free living in a nice, spacious, known location once it’s paid off.
To rent a place of equal quality would probably cost most of us in the neighborhood of 1000+ per month. Once paid off and near the end of one’s working years, NOT having that payment each month will be the equivalent of an annuity paying each month a thousand bucks, which is what you’d have to pay to rent. (More with inflation.)
How much money do you have to have banked to draw a 1000 a month for up to 30 years? Just simple math without accounting for inflation says it has to be in the neighborhood of 360,000 dollars.
Owning a house is the equivalent of having something like a 300,000 dollar annuity when you retire.
“Owning your own home is still the best investment because it’s rent-free living in a nice, spacious, known location once it’s paid off.”
It’s not rent free when you have to pay property taxes every year.
I couldn't disagree more.
Never buy a home as an "investment". Buy a home because that's where you want to live. The value of a home is dependent on a lot of factors beyond your control. Where are you on the demographic curve when you buy? What are interest rates when you buy? Are jobs plentiful in the area? Are the schools good quality? Also, you never really own it, try not paying the real estate taxes and see what happens.
The Case-Schiller index just showed another 5% decline in median home prices.
The vast majority of the "smart" investors are upside down with the "best investment" they made. One of the key factors in home pricing is the median income in the area. Wages are flat, or declining, which means the % able to buy is in decline as fast as the home values are declining.
IOW, buying a home is a TERRIBLE investment. It's only smart if the monthly cost is 38% or less of your income and it's where you want to live.