I’m not sure what to make of the value of our home is right now. A house in our neighborhood recently went up for sale – with a lot of square footage & high finish quality – but with a relatively low asking price. I really would have expected it would be priced 10% higher.
We’re not thinking about selling anytime soon, but I still like to keep my eye on what houses are going for in our area. Nationally, the headlines are filled with articles about an explosion in home prices. The Case-Schiller National Home Price index shows that prices have been on the rise since 2012. They shot up an amazing 11% in the last 12 months (+8% in our zip code, according to Zillow).
Despite the incredibly positive national trend, I don’t think we’ve made a penny on our house since we built it 11 years ago. Our current Zillow price estimate is about the same as what we originally paid for it. Relative to our neighbors’ house now for sale, even that seems high.
In terms of investment return, it certainly takes the cake as our biggest ‘Financial Failure’. We built at the bottom of the market in 2009, so we hoped we would see some upside as the housing market recovered. We understood it could take some time since new custom homes come with a premium of ~10-15% to the builder.
Still, after a decade, I expected that premium to be covered by now. Especially given that we’ve added 350 finished square feet, screened our deck into a covered, three-season porch, and added a lot of built-in cabinetry.
Of course our home is much more than a financial investment to us. We’re on a nice lot, in a terrific neighborhood, and both Money magazine and US News & World Report have ranked our city as a “Best City To Live” (#9) and “Best Small City” (#23) in America. Everything in our house is designed exactly as we wanted it and even our new puppy seems to like the digs. 🙂
Still, many of the houses in our neighborhood have those same benefits and the market isn’t rewarding them when they go up for sale.
Here’s hoping our neighbors are soon receiving multiple offers on their house and it goes for way over asking price! (With a nice family and a cute dog!)
How are home values doing in your immediate neighborhood?
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