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HousingWire argues down-payment math favors homeownership vs S&P 500

HousingWire says comparing the down payment on a Nantucket home to an S&P 500 investment with dividends reinvested would grow the $100,000 stake to about $2.5 million by 2025, versus roughly $4.0 million in equity from the home, after accounting for principal and interest.

Reported · Written up by our desk · Residential

HousingWire disputed a Bloomberg op-ed’s claim that homes are no longer the best place to put money, arguing the comparison is flawed because it treats a home purchase as if it were paid with cash rather than using a down payment.

In HousingWire’s example, a $500,000 Nantucket home bought in 1995 with 20% down implies a $100,000 down payment. It says that $100,000 invested in the S&P 500 with dividends reinvested would reach roughly $2.5 million by 2025.

The outlet also estimates the home’s value rose from $500,000 to about $4 million, so the down-payment equity would correspond to roughly $4.0 million, a 40x return. It further argues that including principal and interest costs over 30 years at a blended average mortgage rate of 7% would still leave the down-payment equivalent turning into over $3.0 million after P&I.

HousingWire adds that it views homes primarily as shelter rather than an investment product comparable to equities, and it says return-only framing omits the household stability and lifestyle factors that drive many people’s decisions to own rather than rent.

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