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Fb2 Houseonomics: Why Owning a Home is Still a Great Investment: Why Owning a Home is Still a Great Investment ePub

by Gary N. Smith,Margaret H. Smith

Category: Real Estate
Subcategory: Business and Work
Author: Gary N. Smith,Margaret H. Smith
ISBN: 0137133782
ISBN13: 978-0137133789
Language: English
Publisher: FT Press; 1 edition (May 1, 2008)
Pages: 240
Fb2 eBook: 1847 kb
ePub eBook: 1697 kb
Digital formats: docx mbr azw lrf

forget it. This calculation goes from marginal to disaster if real estate prices continue to fall.

By Gary N. Smith, Margaret H. Smith. Published Apr 21, 2008 by FT Press . Investing in your own home is as potentially rewarding as investing in the stock market. Learn how your home can become a major engine for your prosperity. Your Home Is an Investment 29. A Home to Call Their Own 29. Look at the Whole Picture 30. What Am I Supposed to Look at Again? 31. The Bottom Line 32.

In Houseonomics, two leading economists demonstrate why owning a home is still an excellent investment for most people in most places and help you make smarter decisions wherever you are. This book isn't for aspiring slumlords or flippers: it's for anyone who simply wants to move. This book isn't for aspiring slumlords or flippers: it's for anyone who simply wants to move towards financial security, with a roof over their heads, and a home to call their own. You won't find "too good to be true" schemes here: you'll find a sensible, rational, and totally up-to-date explanation of the economics of home ownership

Luis Viceira still sees plenty of advantages in looking beyond home markets. Investors in global equity markets have traditionally hedged their bets, casting their investments far and wide across the world.

Luis Viceira still sees plenty of advantages in looking beyond home markets. That way, if the market in one country or region stagnated (think Japan in the 1990s or Europe in the 2000s), they could make up the difference in other sectors that are booming.

Houseonomics explains why a home is still an excellent investment for most people and helps readers make smarter . This book is for anyone who wants to move toward financial security with a home to call their own.

ISBN13:9780137133789. Release Date:April 2008.

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Gary and Margaret Smith make a convincing case why home ownership is still an excellent investment for most people, despite the recent drop in home values

Gary and Margaret Smith make a convincing case why home ownership is still an excellent investment for most people, despite the recent drop in home values. They expound on their concept of home dividends. They also explain the ins and outs of investing in real estate for profit in today's volatile environment.

In most locations owning a home is good investment. Is the stock market still a good investment?

In most locations owning a home is good investment. Some locations are declining in value so contact a good experienced real estate agent in the area you are considering making your investment  . Is it ultimately better to rent or own a home? Is Ethereum a good investment? Is it safe to invest in Bitcoin now?

Gary N. Smith is Fletcher Jones Professor of Economics, Pomona College, where he teaches Macroeconomics, Mathematical economics, Money and Banking, Securities Valuation, and Statistics. in Economics from Yale University. More from Gary N. Recent Articles By Gary N. The Housing and Economic Recovery Act of 2008 - Why it Was Passed, How it Works, and Who Benefits.

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The subject of two articles recently published in the New York Times and endorsed by many leading economists, the authors have developed a completely new process for accurately assessing the value of your home or a potential home. For generations, buying a home has been the best investment Americans could make. But what about now? In the wake of the "housing bubble," some talking heads claim that it's become foolish to own a home with a mortgage. They're wrong. In Houseonomics, two leading economists demonstrate why owning a home is still an excellent investment for most people in most places and help you make smarter decisions wherever you are. This book isn't for aspiring slumlords or flippers: it's for anyone who simply wants to move towards financial security, with a roof over their heads, and a home to call their own. You won't find "too good to be true" schemes here: you'll find a sensible, rational, and totally up-to-date explanation of the economics of home ownership. You'll discover how to calculate the intrinsic fundamental value of a house based on a completely new valuation strategy developed by the authors; develop a vision for financial prosperity via home ownership; and treat housing decisions as the investment decisions they really are. Learn how to negotiate more effectively when purchasing, selling, financing, refinancing, or remodeling; decide when you should prepay your mortgage; and intelligently evaluate rental/vacation properties.
Comments to eBook Houseonomics: Why Owning a Home is Still a Great Investment: Why Owning a Home is Still a Great Investment
Went Tyu
This is an excellent book that focuses on the savings and investment return that you can make when comparing renting vs. buying a home. The book also uses a unique home dividend formula that helps you assess whether or not the home is worth the purchase. The book also focuses on how to build wealth by owning a home. I recommend the book, especially in this housing market with low interest rates.
Adoraris
Often buying a home can be an emotional decision, but the authors give rock-solid reasons why it makes financial sense to purchase a house. Gary & Margaret Smith unveil the mysteries of mortgages and give some creative tips for getting the deal done. A handy little reference book for wanna-be homeowners and a great reminder for current homeowners who may be struggling to keep their house. The bottom line is that home ownership makes SENSE!
Joony
Firstly, buying a house is a great thing if you need one. For example: if you are married and have children, there is no place better than your own house for stability and a sense of "home" to raise children in. There is no dollar amount you can place on these types of benefits.

But the logic of the "Home Dividend" described in this book I would never have guessed came from a trained economist unless the National Association of Realtors paid them very handsomely.

Most economists are very familiar with the concept of "opportunity cost." It is he cost of the next best alternative available. The Yale and Harvard PhD authors seemed to have forgotten this in their calculation of the "Home Dividend."

In the example given, a Fishers, IN couple making $80,000 per year put down $27,000 as a down payment. Nowhere is it mentioned that they will be forgoing what this could have earned. Since 2005 a 50/50 split between Series I Savings Bonds and the Vanguard Total Stock Market Index ETF (hardly a risky portfolio) would have been up 20% since that date with minimal tax implications. (The "Beanie Baby [...] stock investments" noted in the book I consider straw men.)

The "tax savings" is even more bizarre. Having a $6,120 of home interest deduction along with a $2,620 property tax bill equals $8,740 to "write off." For some reason real estate buyers find this great. The standard deduction for a couple earning $80,000 in 2005 was $10,000. House or not, this couple would have taken the standard deduction. There would be no change in their federal tax bill whether they rented or bought. The correct tax benefit is $0 and not the $2,447 noted in the book.

We haven't considered the %6 (perhaps lower) "back end load" involved in such a purchase in real estate commissions. For anyone who has ever sold a home they will tell you, the number and total amount of fees associated a real estate transaction is staggering.

And having owned a house, the maintenance cost of 1% is a dream, especially when you add something for the amount of time you will spend doing it. The cost of keeping the style "current" and salable........ forget it.

This calculation goes from marginal to disaster if real estate prices continue to fall.

If you have to discontinue contributions to a 401K (and forgo employer matching) to make a house payment you will never make up that opportunity cost. Buy a house for a lifestyle, it can be a great place to live, but I wouldn't want to invest for this "Home Dividend."
Biaemi
I bought this book precisely because of its slant, which is pretty much that buying a house is always a great idea. I did this to get the opposite perspective of some of the other things I've been reading.

This book serves as a useful reminder to those who live in lower-priced housing markets that home ownership is generally a good idea regardless of the condition of the market, particularly for those thinking of living in the house for a long time. You build equity and you get a tax break on the mortgage interest, as opposed to rent which simply disappears. However, the relentlessly positive tone in the book just falls flat these days (spring 2008) for anyone in a market where a mortgage would be more expensive than rent. For those in more expensive markets, the appreciation or DEPRECIATION in house values really matters, even for those who are only going to live in the house for 5-10 years (over 30 years, the market will average out and the purchase value won't matter as much).

This book gets repetitive, making one point for most of it. It's a quick read, but you get the point in chapter 2. The book makes no mention of how to know WHEN to buy. When housing plummets 20% in one year (as it has in many of the most expensive markets), timing becomes a very important decision, even for the long term. (If you think about it, those who put down 20% in 2007 have lost their down payment entirely if they have to sell before the market comes back). This book is a somewhat useful companion to a more clear-eyed analysis. When I find THAT book, I'll let you know.
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