Or lose. After all it’s not like stocks have done any better in this market than housing as far as holding their value, let alone appreciating.

I think everyone understands the rent vs. buy arguments, but I wonder how many people who argue against ownership are basing most of their argument(s) on the inflated house prices we’ve seen in the last few years.

As far as having to live somewhere, I did not deny. I won’t bore you with rent vs buy calculations since you know more than I do, but renting is a nice option for many, many people.

What is the overall impression of the chart? That, purely as an investment, a house has not made any real returns since 1979? Did COTD include rental equivalents? Are you including equivalent rent in your analysis and do you consider that a non-monetary benefit?

The issue appears to be investment returns on housing. Suppose this chart was about GM shares? Would it have elicited the same reaction from you?

I apologize for my somewhat sarcastic first post since it was fairly trollish, but I hold you to a high standard, one which you have earned so far.

The only balance remaining on my mortgage is a small balance in a 5/1 ARM that just went to a little over 3% (I had thought it was going into the 2% range but I was wrong about the add-on amount over the treasury rate. Also, the bastards adjusted over the 1 year instead of the 6 month, which added about .25%) Either way, thy payment is probably less than some big spenders paid for Starbucks in given month before the crash. I have enough in a CD to pay it off, and it’s earning about the same amount as the new rate.

I’d rather live here than in a tent, an apartment, a box by the tracks, a relative’s home, or someone else’s place being rented to me. Many people probably feel the same about their home and don’t understand busybodies who complain about their desire to own one.

The only problem is that my house is in a high real estate tax area. That sucks. When real estate recovers, I may sell out and buy in a location that has minimal state taxes and minimal real estate taxes and does not price their homes like those in Crazy Town.

This is a rather disappointing bit of Yun-ish drivel, something which your site is usually above. COTD (I did not read the original article) is simply analyzing the real prices of housing. You, for reasons I can’t understand, have suddenly lost objectivity about housing and investing.

[BR: No, I haven't suddenly lost objectivity or become a cheerleader. I disagree with the overall impression this chart creates]

What does item 2 mean? Are you implying that paying rent is a net loss while paying mortgage is an investment? If so, then you should provide a full rent vs buy analysis instead of seemingly trotting out the moribund “Renting is Throwing Your Money Away Argument”, an argument which is unfounded and errroneous in most cases.

[BR: You have to live somewhere !]

What are the “non monetary benefits” home ownership? Major repairs, insurance, illiquidity? What about the non monetary benefits of renting such as minimal risk, preservation of liquidity, freedom of movement? And since when have you ever waxed lyrical about the hedonics of investing? Do you advocate buying GM shares over buying Toyota shares because of the additional utils achieved from “buying American”? What about buying AIG bonds instead of Walmart bonds because they use prettier font and nicer paper for the coupons? From a purely economic point of view, these are valid arguments but I can’t recall seeing anything of that type made on this site.

[BR: If you have no clue what non-monetary benefits are, I cannot explain it to you in a few 100 words]

I am truly at a loss to understand the point of your story other than you own a house and have finally hit the wall, allowing your emotions to override your objectivity. Or have I missed something? If so, mea culpa and I retract.

The data involves median house price, not average. By definition half of the data clocked in above the median price and half the houses clocked in below the median. It doesn’t matter if the half of the data above the median includes many houses in FL, NV, CA, AZ. What matter sis the mathematical consistency. It is still legitimate data.

To capriciously attempt to remove data points that are above the median simply because “they’re too high” (e.g. simply cuz they were in Cali, AZ, NV, FL) would be like me arguing that all the really hot days should be removed from median temperature data cuz, well, cuz “those were summer days!!.

Or am I missing something?

I was just about to write that. Its one thing to be inflation-adjusted, another caveat would square-footage-adjusted.