Realizing a Profit On Your Home Is An Investment in Time

According to a recent study released by Zillow, it takes an average of 13.5 years to gain a profit on the sale of your home.

That’s based on a national average, paying a 3% down payment and your closing costs, and assuming you’re paying interest at today’s rates and at today’s home prices. It accounts for paying a 6% real estate fee to sell your home in the future, among other things.

The data looks at several of the major markets in the country, including Portland, Oregon.

Portland comes in at one full year less than the national average, but nowhere near the top. Actually, San Jose, CA is the #1 spot, taking 6 years, 11 months to realize a profit.

Here’s the thing, if you’re like most people, you will buy real estate and hold it. By nature, real estate is a long-term investment. A large share of people who invest in real estate do so with the purchase of their primary residence.

Expecting a HUGE profit in a normal market after just a few years is not going to be the case for most people! When you're saving for retirement, do you expect to make all your gains in a couple years on your 401(K), or are you saving and investing for many years to maximize your return on investment?

The last couple years in home value growth were unicorn situations. Buying today doesn't exclude you from being able to realize a return on your investment in real estate if you were to start today (or the near future).

Just think, what other investment also gives you a place to live?