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Housing Returns Equivalent to S&P from 1987-2025

https://www.urban.org/research/publication/why-funding-down-payment-retirement-funds-winning-proposition

To determine whether these incentives make financial sense for aspiring homeowners, we compare returns on owning a home with average annual stock market returns measured by the S&P 500 Index from 1987 to 2025. We evaluate national homeownership returns on an all-cash basis and with two levels of leverage (20 percent down and 3.5 percent down) and for more active and passive refinancers, as well as returns in Detroit and San Francisco, markets that have been stereotyped as weak and strong housing markets, respectively.

Borrowers with low down payments (e.g., 3.5 percent) who refinance whenever rates drop 1 percentage point achieve housing returns comparable with S&P 500 returns (table 1). Borrowers who wait until rates fall 2 percentage points earn slightly less than stock market returns. Homebuyers putting 20 percent down for conventional financing typically see returns about 50 basis points below the S&P 500.

submitted by /u/External_Koala971
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source https://www.reddit.com/r/RealEstate/comments/1v9wrlf/housing_returns_equivalent_to_sp_from_19872025/
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