[this is a ymoyl update.]

i see it’s been 19 months since i had anything to say here, and really nothing to say even then. there’s been nothing to report, i’ve just been working along, saving along, investing along. i did move into greenblattized value investing, but you have to make up your own mind as to whether you’re one of the faithful there.

i have news this month, though. i sat down at settlement thursday and signed my house over to new owners. it’s now the first home of a young couple starting out together.

from time to time, i’ve updated the spreadsheet i made after my last look at what the house had cost. i was able today to update it with final sums and take a view of how the house turned out as an investment.

the quick and superficial story is that i bought it for $108,000 and sold for $225,000, making a 108% return on investment, or about 18%/year. better than stuffing it in a mattress any day.

as i said before, though, i don’t think that gives a realistic picture of what happened. i sat around today making up different formulas to reach a more meaningful number, and decided the simplest way is to look at it like a big savings account. over the years, i put x into the account, and when i closed it, i took y out.

this gives me two numbers:

input: $198,865.

this is the $108,000 to pay off the original house cost, plus mortgage interest, settlement fees, realtor’s commissions, property taxes, home improvements and repairs, homeowner’s insurance, etc. all the money that came out of my pocket (or out of the sale price at the end) and into the property.

output: $282,349.10.

the sale price plus tax savings and rent i collected. $24,000 of this is rent i didn’t have to pay for the two years i lived there, estimated at $1,000/month for a similar house or apartment. i decided to include this as money saved through the investment, so subtract $24k if you think it bogus.

the result is a $282,349.10 withdrawal from $198,865 of deposits, or a 42% return. instead of 18%, it was an average of a 7% climb a year.all of this before taxes, of course. better than i would have found in a deposit account, less than i would have hoped for from stocks and bonds. whether i should have just rented, made regular investments, and avoided the past year’s aggravation is something i’ll have to ponder.

in the meantime, many, many thanks to my realtors for all their advice and to all the contractors who made the house presentable and pleasing to the buyers. i hope they have happy years in it and that the market is as favorable to you if you sell soon, too.

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