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The structure requires repairs and maintenance over time. If the owner keeps up with this cost, there isn't as much reason for the structure itself to decrease
by bitshiftfaced 6y ago
The structure requires repairs and maintenance over time. If the owner keeps up with this cost, there isn't as much reason for the structure itself to decrease in value. Some homes can be outdated and need a remodel, but that gets baked into the price as well.
Land is finite, and becomes more in-demand as the population increases. When homes appreciate in value over time, I reckon that's mostly the result in land being more in demand and/or asset inflation.
- jopsen 6y agoBut population isn't set to go up in any industrialized countries.
- bitshiftfaced 6y agoBut it has consistently grown: https://tradingeconomics.com/united-states/population https://tradingeconomics.com/united-states/population. Don't forget the other part I mentioned: asset inflation (here the asset is the land and structure). Money supply has grown over time: https://fred.stlouisfed.org/series/M2 https://fred.stlouisfed.org/series/M2
- dharmab 6y agoIt is when you consider immigration.
- jopsen 6y ago> asset inflation That makes sense. But then other investment vehicles should also do fine. I suppose it then comes down the fact housing can have a higher leverage than any other investment vehicle. So buy a house, but don't pay it off.