One interesting real estate related fact is that a primary residence is there easiest and cheapest leverage a normal person can get. So that 3% can actually be 5x - 20x that depending on the individual circumstances. Not that I'm advocating for everyone to buy homes as short term investments. Just something interesting that may help some of the more financially sophisticated home buyers out there.
This is true - you get easy leverage, and your gains apply to this larger principal, however, if your gains average out to be less than your cost of capital then leverage doesn't matter. Additionally, over the infinite timeline these computations and averages can look good, but your ability to make payments puts some risk premium on having large leverage. Over the short term, leverage can be much more dangerous, especially if you are forced by circumstance to realize gains or losses.
