[fpgaminer]

I don't think real estate/paying into your mortgage is risk-free. I'd say it's about as risky as long term investments into the stock market.

Over all of recorded history, the stock market has gone up 10%/year on average (not accounting for taxes/inflation).

The common rebuttal to that is that past performance is not an indicator of future performance.

Sure, but then you have to apply the same logic to the supposedly "risk-free" real estate. I think it's just as likely that your house becomes worthless as the stock market no longer giving 10% returns.

My more general argument is that for all intents and purposes the stock market is a gauge of the overall economy. If suddenly the stock market stopped returning 10%/yr the economy as a whole would be in serious trouble. No investments, real estate or otherwise, would be safe. Your stocks would be as worthless as money stashed under a mattress.

That's my logic, at least. Of course, as I said, I don't follow that logic personally. Not that I don't agree with it, just that I'm willing to sacrifice financially in exchange for the satisfaction of owning our home.

[jjeaff]

I'm afraid your logic is a bit flawed here. The home value increase or decrease does not factor in when considering your mortgage. Your mortgage continues to exist no matter where your home value goes.

You have to pay that same mortgage even if the market tanks and your home becomes worthless. Even in the case of just "letting it go" the bank will take your worthless house and will still come after you for what remains on the mortgage.

That is why putting money into your mortgage is a "risk free" investment at 4% (or whatever your rate is).