Thread by @TaylorPearsonMe

@CoachCarter19 I think most people fail to accurately forecast the returns on buying a single family home in a way that factors in their time.

@CoachCarter19 For people with flexible incomes (e.g. business owners or those advancing in their careers, there's a huge time component that goes into it that isn't appropriately adjusted.

@CoachCarter19 The historical unlevered returns are about 1%/year and it's also highly correlated with local labor market so you are making a big bet with low returns which usually correlates with your income source.

@CoachCarter19 The only way it works out is if you get massive price appreciation (which US investors have over past few decades).

And even then, I think for a lot of people the time factor swamps it.

@CoachCarter19 I am mostly thinking about it through the lens of individual buying a primary residence.

I think lots of interesting ways to include RE in a portfolio using various instruments, just can't wrap my head around it buying a home.

@CoachCarter19 To the 1% point above, US investors have access to very cheap leverage which helps but that means you are now just taking a highly levered bet with a big portion of your assets on something correlated to your income which doesn't sound that attractive.