Wayne, you forgot to add maintenance to the own scenario. Wear an tear on roof, exterior and interior surfaces, flooring, HVAC, plumbing, water heater, kitchens and baths. 1%/yr/value of home is conservative.
I am not sure how Wayne is "losing his shirt." Some will falsely value equity over current and future cash flow. Equity doesn't put food on the table. The primary good of owning housing lies in the fact it is indexed for inflation. If your property doubles in value over 10 years, it is not necessarily an indication of a good investment. That appreciation is primarily attributed to inflation. The danger lies in the fact housing has appreciated far in excess of inflation for some time. When wage inflation does not match housing appreciation, the fundamentals become stressed.
I am glad that folks are finally willing to admit that housing can and may go down. At least we're getting somewhere.
