 | Randy Vickers is the owner of Priority Mortgage Corp of Wichita, which opened in Jan. 1989, is the oldest locally owned mortgage company in Wichita. Randy has been in the real state business since 1983 and is a licensed real estate broker as well as a licensed mortgage broker. Priority Mortgage Corp of Wichita KS Lic #1996-0122. Randy can be reached at 316-721-7700 |
Real Estate
2007-07-01 16:13:00
Investment or shelter?
Is real estate an investment or shelter?
Answer: What a great question that millions of people ask themselves every day, and the answer for the vast majority is, both. All of us need a place to live, sleep, gather with family, and stay sheltered on cold and rainy days, and your home will provide this for you. It also provides the largest part of financial security for most homeowners. The households of America that own their homes have a much better chance of achieving financial security.
Nationwide the housing industry is one of the biggest parts of our economic growth. As much as 1/4 of the GDP is related to the housing industry, which is why the economists pay so much attention to the health and stability of the housing and construction industries. Housing is clearly a significant sector of the economy, and it is also noteworthy that the value of residential real estate has grown far more steadily than the aggregate value of corporate equities, such as stocks and bonds. Since 1959 the wealth associated with housing exceeded that of equities, except for a short period from 1997 to the 2nd quarter of 2000, when the stock market began to crash. Housing has had a much steadier climb, and as of 2003, the value of home equity exceeded the value of stock directly owned by the households by close to $3 trillion.
There are some other interesting stats concerning the investment in housing.
In 2001, roughly 68% of American households owned a home, but only 52% owned stocks. 1/3 of the wealth created by stocks is controlled by the top 1% of stockholders, while this same 1% only controls 13% of the equity in housing. What this means is that the average American is much more likely to have a greater part of their net worth in real estate, than in equities.
In almost all cases, housing takes care of two needs for us; simple but very important as a shelter, and also as the major part of our net worth and financial security.
In short, everyone that can should go buy a house...More Next Month
