It may be time to revisit the idea that houses are good investments—a concept that ended with the 2008 financial crisis. This according to a recent article in The Wall Street Journal.
“In a world of zero interest rates and bubbly stock markets, your house may once again offer the best returns of any asset class—provided you think of ‘return’ the right way,” the article notes. Total return, it explains, includes capital gains plus income. Regarding a house, this equates to the services it provides, “which may not be cashable but are very tangible.”
Since the pandemic, the article notes, the services houses provide has expanded beyond simply providing shelter. “For most workers, it has doubled as an office,” according to the article, which adds that while 24% of the workforce typically works from home, the pandemic has pushed this to 31% (data from the Labor Department).
While most workers will return to offices when the pandemic is over, the article reports that many “have discovered they are happier, more productive, or both, working remotely at least some of the time.” This not only saves employees commuting time and expense, but also offers employers savings in the form of less required office space. The expanded geographic landscape afforded by remote work opportunities, it says, could also lead to “a better fit with higher pay.”
Houses are also doubling as classrooms, the article notes, adding, “True, you can’t monetize this. But if your children learn better in a roomy house than a cramped apartment, that is worth something, as is the potential to host home-schooling pods.”
The housing market is experiencing a shot in the arm, with buyers reportedly gravitating away from cities to affordable suburbs. According to Redfin, 21% of buyers recently surveyed said they want space to work from home as well as more outdoor and recreational space. And the article notes, “savvy sellers are catching on: along with granite countertops and master bathrooms, listings now mention attractive backdrops for Zoom calls.”