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Homes as Investment

March 06, 1988

An article (Feb. 28) says that home ownership is a sound investment based on an assumed inflation of housing values of about 4.5% a year over the next 30 years plus tax and interest deductions.

Does this also hold true at the 9%-10% mortgage interest rates that most home buyers seem to be paying for 30 years? Is this irrelevant? I am confused.

G. LUPAYNE

Downey

Editor's Note: John Pfister, a Chicago Title Insurance Co. vice president said that figures were based on the Home Buyers Survey of 1987, when mortgage interest rates averaged 10.4%. He said that when mortgage rates go up or down, this also is reflected in interest rates paid on savings accounts.

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