buying a home - Are you losing if you don't buy in high appreciation area?

[Mark Weins]

Any mortgage experts in here?

If you buy a house today that you intend to live in with your family for the next 10-20 years would you be wasting your money if you bought a house in a (i'm going to use the terminology broke area) where the yearly appreciation for houses is either low or non existent? I am talking about houses in bad markets or poorer states like Michigan or Ohio where the economy is declining as well. I did some calculations and if you were to buy a $500,000 house with 20% down payment of $100,000 on a 30 year mortgage at 6.6% interest, you would pay a total of $1,020,000 ($520,000 interest) for that home in 30 years which is 100% of the value of the house. This means if you buy in a poor area you would be paying 920k + your down payment for your house in 30 years not including HOA and maintenance/repairs/renovations which would easily amount to over a million making your home essentially a money pit that does not grow in value if you don't buy a property with good appreciation.

If you shorten the timeframe to a 15 year mortgage, you would have a better interest rate at 6% and pay only $210,000 in interest instead bringing the total cost of the home to $710,000. That's almost a 30% improvement in price. At this point I don't get the advice that your home should be up to 5x your annual salary as if you do that you will almost certainly need a 30 year loan which will be hard to pay off early. The best strategy for buying a home seems to be to buy in an area with high appreciation and probably much more affordable (and low budget) based on my income and MOST IMPORTANTLY to be able to pay it off as quickly as possible in a 15 year mortgage rather then 30, that way I can save almost 20k a year on my home and when I sell it after it appreciates I will end up with more money as well.

I know the average yearly appreciation rate for homes is 3.5%, that means for 15 years and 30 years of ownership you would have 52.5% and 105% home value increase if you bought in one of these areas which would not give you much profit after selling the house and paying the mortgage + interest for owning the property if you intend to live in it. You would just have your equity.

If you bought in a hot area like Seattle instead where the average home value increased by almost 10% between 2021 and 2022, it makes alot more sense to buy and live in areas like this where 15 years of owning a property would get you 150% value increase which would technically give you 500k in profit when selling the house on top of an extra 300k from saved cash through paying off the mortgage faster. Am I right about all of this?

TLDR: Buy in hot markets and payoff mortgage faster or you will not make money when you sell your house