Looking Beyond the Numbers

With interest rates higher than they were just a few years ago, I've heard the same question over and over: "Is building a home still a good investment?"

It's a fair question.
Most conversations immediately turn to mortgage rates, appreciation, construction costs, and whether it makes more sense to wait.Those are important considerations.
But I think we've been asking the wrong question.
The better question is:

What other investment has the potential to create value in so many different ways at the same time?

Because a home is one of the few investments that can provide three different kinds of return simultaneously:

• Financial Return – Building long-term wealth
• Behavioral Return – Building financial discipline
• Life Return – Building what matters most

Very few investments can honestly say the same.

Financial Return — Building Long-Term Wealth
Most people think the financial return of a home is simply appreciation.
While appreciation is certainly part of the story, it's far from the whole story.
A thoughtfully purchased or built home has the potential to build wealth in several ways at once.

Appreciation
Historically, residential real estate has appreciated over long periods of time. While no investment is guaranteed and markets naturally fluctuate, homeownership has consistently been one of the primary ways American families build wealth. Federal Reserve data continues to show that home equity represents one of the largest components of household net worth.
Unlike rent, your monthly payment is helping you own an asset that has the potential to increase in value over time.

Tax-Efficient Wealth Creation

One of the most overlooked advantages of homeownership isn't appreciation.
It's what happens after appreciation.
Under current federal tax law, many homeowners who meet the ownership and residency requirements can exclude up to $250,000 of capital gains from taxable income when selling a primary residence—or up to $500,000 for married couples filing jointly.
Think about that. If your home appreciates by several hundred thousand dollars over many years, a significant portion—or potentially all—of that gain may never be subject to federal capital gains tax if you qualify. Very few investments offer that type of tax efficiency.
It's one of the reasons a primary residence can become such a powerful long-term wealth-building tool.
Of course, everyone's tax situation is different, and tax laws change over time, so it's always wise to consult your CPA or tax advisor before making decisions.

Your Home Can Continue Working for You

Another benefit that's often overlooked is flexibility.

A home doesn't necessarily stop being an investment when you move out.

I recently spoke with someone whose goal isn't to sell their home when the time comes. Instead, they plan to convert it into a rental property, allowing the rental income to help fund their children's college education.

It's a strategy that highlights just how versatile real estate can be.

Over time, a home may:

• Appreciate in value.
• Build equity.
• Benefit from favorable tax treatment under current law.
• Generate recurring rental income if converted into an investment property.

Not every family will choose that path, but it's a reminder that a home can continue creating value long after you've lived in it.

Behavioral Return — Building Financial Discipline

One lesson I've learned is this: The best investment isn't always the one with the highest theoretical return.
It's often the one you consistently stick with. Homeownership naturally creates one of the most powerful financial habits there is: consistent investing.

Every month, a portion of your mortgage payment generally reduces your loan balance, increasing your ownership in the home.
Without having to make a new investment decision every month, you're steadily building equity. That's powerful.
Many people intend to invest consistently.
Life gets busy. Unexpected expenses arise. Plans change.
A mortgage creates a framework that encourages long-term discipline. Over years—and eventually decades—that consistency can become one of the greatest contributors to long-term wealth. Sometimes building wealth isn't about finding the perfect investment. It's about consistently participating in one.

Life Return — Building What Matters Most

This is the return that changed my perspective.

It's easy to evaluate a home the same way we evaluate every other investment. Interest rates. Construction costs. Return on investment. Those things matter.

But after building our home, I realized something that no spreadsheet had ever taught me: Not everything that matters has a measurable ROI.

For our family, the greatest return has never appeared on a financial statement.

It's my wife, Kathryne, and our boys, Greyson and Baylen, running to the front door because home is their favorite place to be.

It's watching two little boys spend afternoons exploring the woods, getting dirty, building forts, and simply being kids.

It's grandparents dropping by on a Tuesday evening.

It's cousins growing up together.

It's quiet mornings on the back patio with a cup of coffee.

It's opening our home for Bible studies, family dinners, birthday parties, and conversations that matter.

None of those moments increase my net worth. But they've unquestionably increased the richness of our lives.

And if I'm honest...Those are the returns I value most.

So...Is Building a Home Still One of the Best Investments?

If you're comparing annual returns, there will always be investments that outperform housing during certain periods.

That's not really the point.

A home was never meant to compete with the stock market.

It does something entirely different.

It helps build wealth.

It encourages financial discipline.

It offers meaningful tax advantages for many homeowners under current law.

It has the potential to become an income-producing asset.

And perhaps most importantly...

It becomes the place where your life unfolds.

Very few investments can say all of that.

Final Thought

The older I get, the more I realize there are two kinds of investments.

The ones that grow your balance sheet.

And the ones that shape your life.

A thoughtfully built home has the potential to do both.

Yes, it can appreciate.

Yes, it can help build long-term wealth.

Yes, it may provide meaningful tax advantages and even create future income opportunities.

But beyond all of that...

It's where your children take their first steps.

Where holidays become traditions.

Where friends become family around a dinner table.

Where ordinary Tuesday nights quietly become the memories you'll cherish decades from now.

Those moments don't appear on a brokerage statement.

You can't calculate their internal rate of return.