Even though my house has appreciated 78% since buying, my return on all my money spent is a measly 1.1% per year.
Just a frank analysis of owning a home.
I'm afraid I don't get how you calculated this rate of return. What did you do, add up your payments and then divide by the $ appreciation?
But let's take an example: if originally this were a $100K house that you put $20K down on, that's now worth $178K, I'd say your return is much better than 1%. Yes, you paid a mortgage payment +taxes +insurance, less tax writeoffs. You could compare that after tax payment to the rent you would have paid, and then take the difference and add it to your down payment for the purpose of calculating return.
But I gotta tell you, no one who owned a house that appreciated 78% over the last 10 years made 1%.
By the way, my wife and I own our house free and clear. So we pay taxes and insurance. Try renting for that.
IT
