Houston's slow appreciating real estate...

[tstone]

I guess the point I'm getting at is 7% growth is actually a fairly conservative growth rate. The lowest end of "moderate" at best. You can get double that rate over the long term in something aggressive. Yes, after all expenses are dealt with. No insurance to pay on it, no taxes if you do the Roth or college-fund investment thing.

But here we are strictly talking about value before vs. value after. What about repairs? HVAC, roofs, foundations, carpets, etc (maybe insurance deductibles?) aren't cheap. Perhaps that brings our 7.15% down to around ~ a 6% return. Now what about mortgage interest, 6% or so? So in other words you gave much of that appreciation to the bank for a certain amount of time you had the loan. That point aside, 6% is what ~ 2% higher than the rate of inflation? Hmm...

Because of all this, it sounds like if you can pay cash for the home, or after the 15 or 30 year payments are finished, it's a decent, conservative investment -- a sure thing. (west & inner loop only) Otherwise whenever you are slave to the bank, the mortgage interest can eat up your return. As long as you're paying on a mortgage, it turns into a piggy bank of sorts through the equity. That still doesn't mean it's necessarily cheaper than renting. But regardless of the numbers, I'll never go back to renting again, and I'll always encourage anyone to buy wisely if they can.

Even here in 3-4% Clear Lake (before expenses, ugh). Outside the city limit it's usually worse. We needed to be here in the area for work reasons, but we didn't choose Friendswood or League City due to appreciation being even lower.

[EasilyAmused]

Edited and deleted

I'm not going to get into this any furthur. What I made was after paying the bank back and after paying myself back for remodels and repairs. I'm darn happy with my "conservative" return, and I guess that's all that matters.

[TootsieWootsie]

I LOST money on that house in Bellaire. It was off Newcastle, which is as close to Southhampton and West University $$$-- as you can get (one street), and I am talking the tearing down of the little bungalows and building big $750,000 mansions on the same lots. And the land only escalated a little over double in 20 years? Again, this is a LOSER.
Where in Uptown were you that you profited that much?
Bellaire--which I thought would give me a profit--was a total loss for me. I still am burning about wasting 20 years of my life there and waiting for the big profit I was to get on the land...ha!

[EasilyAmused]

Tanglewood, two lots in from the Boulevard. I bought it before the recovery. They bought it for a tear down and built a 3 million dollar mansion on it. Its was on a 1/2 acre lot, 3200 sf ranch. Similar homes to mine are now selling for 1.1 as tear downs.
I rebought in mid-2006 in North Briargrove after my hiatus in The Woodlands. I can already make a slight profit on this one, but I'm hanging in here another year or so. I'm planning to open an office in the EC in about two years and will be living over that way.