Best Investment

Surprise! Mom and Dad's favorite investment was a big winner last year!

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For all the talk about stocks and bonds, it turns out that Mom and Dad's favorite investment -- a house -- was a big winner last year. While the median value of single-family homes climbed 8.3% in 2004, selling for $184,100, prices in nearly half the markets tracked by the National Association of Realtors (NAR) surged 10% or more for the first time in 23 years. Not bad, considering the S&P 500 gained 10.88% while the Lehman Aggregate Bond Index climbed only 4.34%. How does the rest of the year look for real estate values? "We expect median home prices to appreciate 5% in 2005, slowed by a likely rise in the 30-year mortgage rate to 6.5%," says Lawrence Yun, an NAR economist. Hey, that still beats a money market fund.

From Reader's Digest - May 2005