This article was posted on Tuesday, Dec 01, 2015

You’re right… House prices have gone up – A LOT – in your area.
I know it. You don’t have to tell me. I see it, too.
Heck, I live in Florida… House prices in Miami and Tampa are up 40%-plus since the beginning of 2012. That is an incredible gain.
Conventional wisdom is that house prices should not be able to soar like this for long periods of time.
House prices have a few limiting factors. For example, the population only grows so fast… and people’s incomes only grow so fast. Over the long run, house prices nationwide shouldn’t be able to grow a whole lot faster than those two things.
So you might think that the move higher in U.S. house prices is over. I get it. I see your points.
However, I strongly disagree…
I believe we still have YEARS of house price appreciation ahead of us

The three main reasons are:

1.   With mortgage rates near record lows, housing is extremely affordable.
2.   In our zero-percent world, people will have to take their money out of the bank (that’s earning nothing) and do SOMETHING with it. Some of that money will go into rentable single-family homes.
3.   We’re still a long way from “normal.”

This next chart is one way to show No. 3.  It shows what’s happening in mortgages on U.S. houses. In the housing bust, for the first time in recorded history, the dollar amount of mortgages outstanding actually FELL. The annual change in mortgage dollars went NEGATIVE. Take a look:


As you can see, things are getting LESS BAD.
Today, for the first time since 2008, the mortgage debt outstanding on U.S. homes is actually rising. (You can see it just crossed above the 0% line in the chart.)
The important thing for you to realize is that this is nowhere near “normal” yet…
Since the mid-1950s, mortgage debt outstanding has grown at 8.8% a year, on average. Today – even after incredible home-price appreciation – we’re just getting back to “flat.”
This tells me that most Americans are not on board – yet.
I expect they will get on board. I have my money where my mouth is on this one… I have more of my personal financial assets in U.S. real estate than in any other category… by a wide margin… and that includes the stock market.
Housing is a great asset to own now. It’s affordable (with mortgage rates so low). You control it. You can rent it out for much more than you can make in interest at the bank. And there’s plenty of upside in it today (as the chart helps to show). Basically, nobody is in the market – yet.
You still have time to beat ’em to it!
 Get on it.

Dr. Steve Sjuggerud is the editor of True Wealth, an investment advisory which specializes in safe, unique alternative investments overlooked by Wall Street, and based on the simple idea that you don’t have to take big risks to make big returns. For more information, visit

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A version of this article first appeared on October 6, 2015 in the Daily Wealth, published by Stansberry & Associates Investment Research, an independent investment research firm.  You can visit them at