Denver Mortgage : Is home buying a good investment?

By: Robert Bell | Posted: 10th June 2009

Is home buying a good investment?
denver mortgage

I just want to give you some examples of why I believe home buying is a great investment. I know this is not the time to talk about home buying as an investment in this down market. But I still believe that buying a home, even in this market is still a good investment. I am going to give an example of this.

How much does it cost to buy a home? I mean out of pocket expense? I want to use 2009 as an example. Now most loans are FHA loans or federal housing association type loans. So I am going to use this as an example. I am all so going to use nice round numbers. In my example the house price is $100,000 dollars. In order to get a loan you are going to need a 3 % down payment. That is going to be $3000 dollars.You will probably need to bring some money for the closing cost. Lets say on adverage 2500 dollars to help with the closing cost on a $100,000 dollar house. So we have a total of about $5,500 dollars into the house.
Most people would say that we are down $5,500 dollars but this would not be actually correct. The Us government is giving a $8500 dollar credit to buy a house this year. So now we are up $3000. We do have a mortgage payment to make. Lets say that its total is $850 as an example. Well no matter where we live we are going to have to pay that any ways are we not. So we are now up $3000 so far in our investment.
I do want to consider this a long term investment. So I want to see were we might be in 10 years. On day one we are up $3000. Where would we be at after 10 years. Most houses in our life time have doubled in value every 10 years. So we should be up another $100,000. Our total profit after 10 years if the market works how it has historically is $103,000.I don't know of any investment or business that has a track record like this. As long as your in it for the long haul I believe Buying a home is a good investment.For more investment and real estateDenver Mortgage news please visit http://www.denvermortgage.me to get the latest information Visit Denver Mortgage : Is home buying a good investment?.
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Tags: us government, money, 10 years, long haul, long term investment, buying a home, mortgage payment, fha loans, pocket expense, house price, life time, closing cost, dollar credit