If you have ever wondered about investing in real estate, today's post is for you. My husband and I have often thought we would make more money investing in real estate than investing in the stock market. So I decided to look at a typical ten year return on the average home prices here in Southeast Texas.
My data is from the Beaumont MLS. For consistency I used the month of April from each year to see what the average home sold for.
Here's the data neatly formatted on an easy to read graph for your viewing pleasure.
Your ten year return on investment, if you bought a typical home in 2000, and sold it today would be close to $35,000. That doesn't take into account how much equity you may have built up paying on your mortgage for the same ten year period. If you have a tenent paying the mortgage for you, you'll be even further ahead.
In fact the only three year time frame where you would not make a profit on your investment would have been if you bought in 2002 and sold in 2005. If you waited to sell one more year and sold in 2006 you would have potential made a 10% profit. The average home sales price in Southeast Texas for April 2010 has not been released yet. There is an error in the data that needs to be fixed.
Since the peak of home prices in 2009 the market has seen a small decrease in our average home prices. The decrease is less than 5%.
If you plan to use your home as an investment, the golden rule is still to own for at least three years.
If you want more information about buying investment properties in Southeast Texas, contact me. We can get started building your real estate portfolio right away.