In my last blog I mentioned that today people buy homes to make money. It is all about location, location, location. To simply Las Vegans care about two factors: closeness to airport and closeness to the strip. If you purchase a house far from the airport or the strip your home value will not appreciate as much as homes in simliar subdivisions yet are closer to the two most traveled to destinations in Las Vegas.
Rule of 72 states the amount of return on your money divided into 72 will tell you how much you can double your money. The average rate of return of money invested is 12%. Take 72 the divide by 12. This results in every 6 years your money doubles. Say you would like to purchase a house for $200,000 with cash at age 25. Your money will double in 6 years with a 12% return. Another 6 years later your money doubles again. See the progress below.
Age 25 $200,000
Age 31 $400,000
Age 37 $800,000
Age 43 $1,600,000
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