Comment by mapt
You're neglecting the cost of actually living in a similar dwelling. What would renting an identical house in the same neighborhood cost you?
You're neglecting the cost of actually living in a similar dwelling. What would renting an identical house in the same neighborhood cost you?
That's orthogonal.
The point is that your question should not be "have I made a profit on these houses relative to an index fund" like a speculator.
Your question should be "would I have made a profit on these houses relative to an index fund if I had kept them rented out to tenants 100% of the time at market rates?".
The core to living in a residence you own shouldn't be the asset value, it should be the living. If you're neglecting the market rate for that quality of life in favor of focusing on asset appreciation, you're approaching homeownership in a backwards manner that is ultimately destructive.
Let me put it this way. None of the houses I've bought were bought as an investment. I bought them as places to live in and enjoy. I've lost money on two of them, quite a bit.
Keep in mind that if your house burns down, your generational equity goes up in flames.