Am I looking at this correctly?

[Trey Leigh]

I was looking at some of my spreadsheets and was trying to figure my overall rate of return on a house once it is paid for in the future, with the following assumptions, are my calculation right?

Purchase price 50,000

Sales Price 50,000 (after 15 years assuming no appreciation)

Initial investment 12000 (20% down and 2000 Closing)

CoC return of 9% or $1091/year after all expenses

After 15 years the house is paid for and I sell it for 50,000

Is this how I calculate my ROI of my initial investment?

16365(15 yrs. @ 1091) + 50000 - 12000 = 54365/15 yrs. = 3624/yr.

3624/12000 (initial investment) = .30 or 30%/year ROI?

How about 54365/12000 means my money grew 4.53x or 453% in 15 years?

Sure looks good ;)

[Frank M.]

Exactly - when one asks about a long term return, that's how the math should be done. $1000 today becomes $2000 in 7.2 years at 10%. Any time value of money calculation is done this way. If only for an apples to apples comparison to other investments.