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| 9858 Clint Moore Road, Boca Raton, FL 33496 | Caesar: (561) 715-8630 or Eileen: (561) 271-1311 |
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Future net worth depends on how home is financed
"I am buying a house for $180,000, which I could pay for by selling assets, but everybody tells me to leave my assets alone and take out a mortgage. Their advice makes me nervous because it is always based on generalities, such as 'you want the mortgage as a tax shelter' or 'you should leave your investments alone.' They don't know anything about my tax status or my investments. Is there a better way to make this decision?" According to the study, home values underperformed stocks and bonds over every five- and 10-year period from 1963 to 2005. Home values have been slightly above the returns on treasury bills during the same time, according to the report, "The Equity You Live In: The Home as a Retirement Savings and Income Option." "When we started the work, the real question was: If I have home equity, how should I think about using it in retirement," said Guy L. Patton, executive director of the Fidelity Research Institute. "The conclusion: The returns on residential real estate are probably less than what most people think they are." Over the more than 40-year period, real compound returns on stocks outpaced that of residential real estate, according to the study, with 5.95% average annual returns on stocks compared with 1.35% in realty. A dollar invested in stocks in 1963 would have compounded to $12.36 by 2006, while the same dollar would have grown to $1.79 in real estate. Real estate agent Caesar Parisi stands ready with effective advice on buying or selling a Boca Raton FL condo. Visiting the Delray Beach community? Contact RealtorĀ® Caesar Parisi for information on buying or selling an Atlantic Grove Condo in Delray Beach Real Estate. click here for article |
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