Is Buying a Home in London Ontario a Good Investment?

Is Buying a Home in London Ontario a Good Investment? As a fairly general rule, London homes and condos appreciate about four or five percent a year. Some years will be more, some less. The figure will vary from neighbourhood to neighbourhood, and region to region. For example, a 2 storey home in Sunningdale may appreciate more than a 2 storey home in Oakridge.

Five percent may not seem like much at first. Stocks (at times) appreciate much more, and you could easily earn over the same return with a very safe investment in treasury bills or bonds.

But, take a second look ...

Presumably, if you bought a $200,000 house in London, you did not pay cash for the home. You got a mortgage and lets say you put as much as 20% down, that would be an investment of $40,000.

At an appreciation rate of 5% annually, a $200,000 home in London would increase in value $10,000 during the first year. That means you earned $10,000 with an investment of $40,000. Your annual " return on investment" would be a whopping 25%!

Of course you are making mortgage payments and paying property taxes, along with a few other costs. Your rate of return when buying a home is much higher than most any other investment you can make.

If you would like to know more about other home buying ideas or tips, let me know and I will gladly see that you are informed and knowledgeable before you purchase.