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The article states that since 2009 the stock market has tripled while housing markets have doubled. I'm just reassessing that example with 5x leverage.
by phamilton 9y ago
The article states that since 2009 the stock market has tripled while housing markets have doubled. I'm just reassessing that example with 5x leverage.
- lotsofpulp 9y agoI find it hard to believe if even the majority of housing markets have doubled. Economic growth mostly seems contained to a few established and up and coming cities.
- garmaine 9y agoYeah one flaw with the OP is that you can’t compare against average housing returns. Buying a house or condo in Silicon Valley or New York is going to out perform the average due to supply, demand, and geography. The OP is essentially really saying buy a total stock market fund instead of REIT, which isn’t that controversial.
- garmaine 9y agoOh I didn’t realize those gains were leverage adjusted. But shouldn’t you compare to trading on margin to be apples to apples?
- phamilton 9y agoIn this case I'd argue that apples is "what an average person would do". That's the comparison the article is making. Millions of Americans are leveraged in their homes. Relatively few trade on margin. I think that makes it a valid comparison, even if it's not a fair comparison.