Buying a primary residence might not be as good of an investment as conventional wisdom suggests. However, there are still benefits — financial and otherwise — to owning a home.
Writing for US News and World Report, Miranda Marquit explains the economic costs and benefits of home ownership. Like most economic analyses, the bottom line is that home prices typically track inflation and are NOT a “good” investment when historically one could earn much more by investing in the stock market.
Of course the real estate agent and mortgage broker will claim that houses are the best investments. They want you to buy the most expensive home you can get a mortgage for because the larger the home price and mortgage, the larger their commissions. And they get paid up front and have no worries about whether you really can afford that house in the long run
Marquit explains the costs (beyond purchase price) of primary residence over the years of ownership including:
- Property taxes.
- Homeowners insurance.
- Any upgrades or remodels.
- Landscaping and yard care.
Source: Financial Planning for Women