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Returns to Single-Family Owner-Occupied Housing

UNCG Author/Contributor (non-UNCG co-authors, if there are any, appear on document)
Gustav D. Jud, Retired (Creator)
Daniel T. Winkler, Professor (Creator)
Institution
The University of North Carolina at Greensboro (UNCG )
Web Site: http://library.uncg.edu/

Abstract: This study examines the rate of return and risk on single-family, owner-occupied housing nationally and at the MSA level. The homeowner using no leverage, and a 28% tax rate, earned an 11.81% annual return, 5.85% from implicit rental savings and 5.63% from price appreciation from 1978:1 to 2001:4. The use of leverage increased rates of returns as well as risk, and longer holding periods offered higher returns and lower risk. With an 80% loan-to-value ratio, homeownership returns were between Treasury bonds and stocks, although with more risk than either. Among the 42 MSAs, return and risk varied as much as threefold.

Additional Information

Publication
Journal of Real Estate Practice and Education, vol. 8, no. 1, 2005, pp. 25-44
Language: English
Date: 2005
Keywords
Rate of return, Risk, single-family, owner-occupied, housing, homeowner, Returns