This old article was recommended at Calculated Risk:

Home equity — not stock ownership or other investments — is now “the anchor of household wealth,” according to the 2003 State of the Nation’s Housing report, released this week from Harvard University’s Joint Center for Housing Studies.

Because

Home prices “fall when so many people must sell their homes at the same time that demand is soft.” Yet “even during national or regional recessions, most metropolitan areas do not experience severe job losses or housing price declines.”

And you can use leverage:

Add in the leverage used by most buyers to acquire homes and the potential for serious losses in recessions becomes even less likely. For example, if a buyer put down $10,000 (10 percent) to acquire a $100,000 house with a $90,000 mortgage, the buyer’s leverage ratio is 10 to 1. It would take a 10 percent decline in home values for the buyer to lose the full $10,000 investment.

Don’t be late, because

For the long term, the outlook continues to be positive for home buying and property values. The aging, pre-retirement baby boomers represent the richest generation ever, and they are set to fuel the trade-up and second-home markets for more than a decade to come. Their “echo boomer” children, now entering their prime, first-time purchase years, should do the same for more moderate-cost sectors of the housing marketplace.

And once the baby boomers start passing along a portion of their wealth to their children, a multitrillion-dollar intergenerational capital transfer of unprecedented magnitude, look for still another major stimulus to sales and home values, provided there is no change in federal tax policy.

I’m in!

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