Housing as an Investment? : A Comparison of Returns from Housing with Other Types of Investment

Considers whether housing has been a successful investment for the home owner during the period 1984‐1992, in absolute terms and in comparison with other investment media such as equities and gilts. Discusses the social and political influences which have encouraged a rise in home ownership and evaluates the trends in share ownership. Details the methodologies used in calculating the total returns from housing and the impact of taxation. Shows that, on an aggregated UK basis, housing has shown positive overall returns over this holding period and has proved to be a good hedge against inflation, although under‐performing the returns from UK equities. On a regional basis, the housing returns from the northern regions were higher than those from the south of the country, with the latter also showing a higher volatility of return. Raises the question of whether housing could be a worthwhile addition to an institutional property investment portfolio.