What's been your 5 year average return?

[kumquat]

Our NW has tripled in the last 5 years. No idea what the return has been. Can't be bothered to look up how to calculate it.

This came by careful AA blind luck whatever (letting one stock become > 50% of NW). (Yes I have sold a lot to diversify but the damn thing keeps going up)

[Moemg]

Originally Posted by Want2retire

The OP can speak for hirself, but if one wants to see how well others did in the stock/bond market, real estate should be excluded. Real estate appreciation seems to be very much affected by regional real estate dynamics.

What about the members on here who invest in real estate instead of the market ?

[Want2retire]

Originally Posted by Moemg

What about the members on here who invest in real estate instead of the market ?

Well, if it is an REIT like VGSIX or something, sure - - but if it is your own personal home, it does seem to me that the appreciation could be thought to have a strong regional component. So, althought I'm not trying to speak for the OP I am speculating that investments (rather than real estate such as a home owned in own's local area) is what was intended.

[Want2retire]

Originally Posted by cute fuzzy bunny

I got married and my wife wanted to keep working part time. We didnt need...or want...the high income level and its associated taxes. With a trickle of an income stream I could also take more chances and be less concerned about volatility. I ended up recently buying back into the fund as our new house, its 2x utilities and property taxes (etc) mean a little more income is useful and we've done well enough that I dont need to keep swinging for the fences.

That makes a lot of sense. Thanks.

Originally Posted by cute fuzzy bunny

Fair enough, but the question had to do with return on invested money. I know plenty of people dont consider their primary residence an investment, but I do. What, where and when I buy are factors for potential future return. Stock/bond appreciation also has a big effect in how its 'regionalized'

But would you would move your family, including adorable, sweet, bright little Gabe, and live in squalor in rural Alabama if low end housing there happened to be appreciating more there than high end housing where you presently are? OK, that was rhetorical but you get what I'm saying, I think. It seems to me like buying a home is such a complex issue. Many who live in areas that aren't appreciating, really are tied to those areas or prefer to live there for a number of reasons unrelated to investment that may influence their decision to buy there. However astute an investor one may be, there may be regional influences that can't be overcome. Otherwise, I think we would have to agree that Californians are nearly all great investors and Midwesterners mostly aren't, for example. I am not so sure that's a valid generalization.

ETA: Oh, and then I forgot to mention. When my ex was in the Navy, we lived in San Diego. Then we moved to Texas, and sold the house in S.D. (making a killing). When we moved from Texas, we didn't make nearly as much. So, he became a worse investor as he got older? (grin)

[Moemg]

Originally Posted by Want2retire

Well, if it is an REIT like VGSIX or something, sure - - but if it is your own personal home, it does seem to me that the appreciation could be thought to have a strong regional component. So, althought I'm not trying to speak for the OP I am speculating that investments (rather than real estate such as a home owned in own's local area) is what was intended.

What if it is several rental properties ? Are they not investments?

[TickTock]

I'd count rental properties.

I'd also personally expect better return for the rentals than from my portfolio, to compensate for the extra time and effort.

[edit]

Or reduced volatility

[/edit]

[calmloki]

Originally Posted by Moemg

What about the members on here who invest in real estate instead of the market ?

Dunno - Sold 2 little places early in the year for $300k the pair. Bought one 6-89 for 21K, Gal brought the other into our relationship - she and her ex had bought it for $11K when the prior owner was going to raise their rent to $100/month, then she bought out her ex three years later with it valued at $18k. We spent plenty to upgrade them a bunch (complete re-wires, new sheetrock/floor plans), paid them off, rented them out for decades, borrowed against them several times to buy other places, paid them off, kept collecting rent.... When we sold we were getting $685 and $750/month as rent. I do know that we were only negative cash flow a couple years, usually when we had major remodeling/roofing/new loan expenses. Never had consecutive negative years. For us it seems like it was sort of like a Wellesly type fund that returned maybe 5%/year and then sold for 7.5 times the purchase price after 18-20 years.

[cute fuzzy bunny]

Originally Posted by Want2retire

But would you would move your family, including adorable, sweet, bright little Gabe, and live in squalor in rural Alabama if low end housing there happened to be appreciating more there than high end housing where you presently are?

Of course not. But I did buy into the bay area, sacramento and yuba city areas when I felt they were underpriced and where I had been living was feeling overpriced.

I certainly made conscious decisions that produced large chunks of positive cashflow. I'd expect to feel like an idiot had it gone the other way and I'd lost money and was looking for a government handout to cover my losses. Given the downside, I also feel its reasonable to accept the upside.

Further, I chose to pay cash for the homes (getting a nice additional discount for closing speed and certainty of close) and use the property as a component of my investing strategy.

Certainly the OP is entitled to discuss things the way they want, and I'm well aware of the emotional issues associated with treating the primary residence as an investment.

But gosh darn it, I've made a bunch of money on every house I ever bought, and lived in them for free all the while!!

[Spanky]

Originally Posted by kumquat

Our NW has tripled in the last 5 years. No idea what the return has been. Can't be bothered to look up how to calculate it.

This came by careful AA blind luck whatever (letting one stock become > 50% of NW). (Yes I have sold a lot to diversify but the damn thing keeps going up)

That's 24.57%.

[TickTock]

Assuming no outside additions to the portfolio, yes. Otherwise, that's the same mistake the Beardstown Ladies made when calculating their returns...

[FinanceDude]

A shade under 18, actually 17.9%...just didn't load up enough on REIT or foreign stocks........

[48Fire]

13.8%