Cauldron

Issue date: 10/30/07 Section: Features

Media Credit: Danielle Stillman In-town property has an average annual appreciation of approxiamtely 14 percent, according to homeowner and UST alum Andrew Baker.

Financial investments-the idea can cause college students' eyes to glaze over with boredom as they envision stocks, bonds and money market accounts. But some young adults have chosen to take a different approach to the often intimidating and overwhelming subject.

Two years after graduating from the UST, Andrew Baker bought his first home in January 2007. He said he has always been interested in commercial and residential real estate and wanted to be a homeowner. After doing extensive research on the Houston housing market and house-hunting for four years, Baker found a home in Southwest Houston with the features he was looking for at a price he could afford.

Purchasing a home can play an important role in building financial security, in addition to other investments, according to Jeremi Zabel, a financial analyst for Merrill Lynch.

Baker wanted to buy a home after many years of renting for the financial value of home owning.

"When you rent, you're paying for convenience, but you have no return on your investment," he said. "Every month I paid rent, I felt like I was throwing away money that could be going towards a mortgage payment. Now, I pay less for my monthly mortgage than the average 600-square-foot apartment inside the Loop costs per month while I'm building equity."

Baker decided to buy inside the 610-Loop, based on the location's value.

"You won't get a higher annual rate of return in the city right now," he said, based on his research of the local housing market. "The average annual appreciation of homes inside the Loop is approximately 14 percent, and based on current trends, that will only increase. The market may go through lulls, but the homes will never lose their value."

Amid much national publicity about current difficulties in the mortgage industry and an increasing amount of home foreclosures, the Houston market has remained comparatively steady. The Houston Business Journal recently reported how the city's housing market continues to buck national trends primarily because of the flourishing oil and energy markets that drive the local economy.

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