Ryzen Homes Blog

Ryzen Homes blog. Providing tips and information on building a new modular home or panelized home in Maine and New Hampshire.

Is it Better to Invest in the Stock Market Or Buy My First Home?

Monday, February 23, 2009
As a Maine and Southern New Hampshire modular and panelized home builder, we at Ryzen Homes feel that it's important to keep up on local and national home building news. Here's what the National Association of Homebuilders has to say on your best investment in the current economy:

Thanks to the concept of “leveraging,” purchasing a home is by far the best long-term investment. Leveraging means putting down a small amount of money to earn a big return.

For example, say you use that $10,000 to purchase a $250,000 home, and the house appreciates a modest 3 percent during the first year. That means after one year, the house would be worth $257,500 – a gain of $7,500. Your annual return on your $10,000 investment would be 75 percent.

By contrast, putting the same $10,000 in the stock market and posting a similar 5 percent gain would only net a $500 return on investment.

And as a home owner, your savings continue to grow in two ways. Every year, a greater portion of your monthly mortgage payment goes to the principal, reducing the overall loan amount. Second, your home appreciates over time, making it one of the very best financial investments. Continue Reading...
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