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My parents bought the house I remember from my childhood for $12K in 1960 in the Westchester neighborhood of Los Angeles - not that far from LAX. It appears the home was built in 1949. The photo below is from Google StreetView. I remember helping my dad build that short wall you can see near the front door. Behind its half-height gate was an outdoor sitting area. I remember the detached garage in the back yard (either one or two car; I'm not sure). Attached to the detached garage was an outdoor office (no plumbing).
When we lived there, it was a 2 bedroom/1 bath house plus the outdoor office (I don't know how large - perhaps the main house was 1300 sf, and the outdoor office was another 100 to 150 sf. Square footage has been added to the house over the years, as Zillow now says it is a 3 bedroom/3 bath house of 2017 square feet.
My parents bought the house for $12K in 1960, and sold it for $18K in 1968.
Zillow's Zestimate is the home would currently sell for $1,742,500.
Zillow's rental estimate is $6417/month.
My dad bought a corner lot with a triplex one block up from PCH (on Glenneyre St.) in Laguna Beach for $50k in 1963. Sold it for $100k in 1973 and was happy with the return on his investment.
If it was still in the family now? $2.5 million. Minimum.
He then bought a house in La Habra for $40k, where I grew up. Sold it in 1997 for $340k.
Nowadays? Well, it's a vastly less desirable location, so only $1.3 million.
My parents bought the house I remember from my childhood for $12K in 1960 in the Westchester neighborhood of Los Angeles - not that far from LAX. It appears the home was built in 1949. The photo below is from Google StreetView. I remember helping my dad build that short wall you can see near the front door. Behind its half-height gate was an outdoor sitting area. I remember the detached garage in the back yard (either one or two car; I'm not sure). Attached to the detached garage was an outdoor office (no plumbing).
When we lived there, it was a 2 bedroom/1 bath house plus the outdoor office (I don't know how large - perhaps the main house was 1300 sf, and the outdoor office was another 100 to 150 sf. Square footage has been added to the house over the years, as Zillow now says it is a 3 bedroom/3 bath house of 2017 square feet.
My parents bought the house for $12K in 1960, and sold it for $18K in 1968.
Zillow's Zestimate is the home would currently sell for $1,742,500.
Zillow's rental estimate is $6417/month.
That just takes my breath away.
That’s roughly a 50 fold increase in the housing price from 1960. That sounds huge but doing the math, 50 fold gains in 60 years time are average annual housing appreciations hovering around 6-7% per year. That is a very very good return but it’s actually as alarming as it is, not as good a return as an S&P500 ETF or actively traded equity diversified actively managed mutual fund. A 50-fold return over 60 years is not hard to achieve except the patience of thinking longterm is.
If you had a portfolio of A number of top performing stocks in the S&P500 and kept rebalancing it every couple of years to equally weight it, if you started with $12,000 in investments in 1960 you would have MORE, MUCH MORE than 3
Million today . But ….. 85% of that wealth gain would have been in the last 10 years!!! 1960-2009 would have been depressing and VERY hard to stomach . The LAST decade would be worth that entire wait!
Either they are lying to us about the inflation rate or... (?)
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