WAdem

Adjusted Case Schiller Housing Data

Yes, you probably could have made it more realistic with an adjustment for rents, although Houston is hardly the typical market. In California and Florida, million-dollar homes rent for $3500 per month!

Another oversight like the one mentioned, income tax benefit, is the less obvious lost opportunity of investing in equities. Dr. Shiller mentions that over the 1890 to 2006 period, I think, residential real estate has returned just slightly more than treasury bonds! Not a very appealing investment.

By the way, most of us are actually renters. We rent money from mortgage lenders to occupy their house (until we pay it off). It is little different from renting the same house from a landlord, in fact. And, as we are learning, with great financial risk. Think bankruptcy as the downside vs. "the American Dream".