With the rise and fall of the real estate market in the last decade, many Americans have wondered whether or not they should think of their homes as investment vehicles. In a recent edition of Out on a Limb, Morgan Housel discussed the dangers of thinking about a home in the same way you might think about stocks or bonds.
Says Housel:
I think most people that own their homes are right to own their homes. I think it gets dangerous when people view their homes ... as something that is going to, over the long term, provide them with a lot of money that they can retire on. There's really no historical evidence for that whatsoever.
Housel lists a number of good reasons for buying a home -- a sense of ownership, a long-term place to live, a good neighborhood, and so on. But if homeowners are hoping to "buy a house with no money down and then flip it in five years for a $200K profit, that's a wrong idea and not something a homeowner should count on."
Click play on the video below for more of the discussion.
