Houses merely maintain purchasing power, due to inflation.
People don't seem to understand the difference between nominal and real house prices. Real prices are inflation adjusted. The basically cost the same as they always have, adjusted for inflation.
With real estate sure we get someone to pay off our property, but the reality is we are working for that money. And in the end we merely own a house that has maintained it's purchasing power. If you want to sell the house you live in, sure it tripled in value, great! But so did the other houses...and you still need a place to live, so you didn't really increase but merely maintain your purchasing power. So what's the point of appreciation? It's not as good and meaningful as one thinks. Leverage and inflation adjusted cash flow with eventual pay off are the keys to it being a decent investment. But the value going up alone is merely a hedge against inflation. This is not buying Microsoft at .02 cents a share and making 10 billion off it in 30 years.
