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<blockquote data-quote="Balesir" data-source="post: 6291112" data-attributes="member: 27160">Holding it in the expectation that it will gain in value is &quot;making it work for you&quot; - but it's a risky option with a significant payoff required before it becomes viable. The fact that it can pay off in a few cases is by no means a demonstration of overall advisability; even with a higher price after holding, you need to overcome opportunity costs and even several apparently &quot;successful&quot; cases have failed to do this.In the case of one of these I know about - Jimi Hendrix's music - I don't really think the holding was successful, even if an expected appreciation in value was the sole or main reason for holding (which I'm by no means convinced it was). Holding for, what, 30 years? That would require around a 10 times increase in value just to cover the holding cost. Did it really net that much more? I'm sceptical.To be worth holding, the property must gain value at least equivalent to the opportunity cost. The long term (nominal) return on stocks is currently around 7%. That means that, even for a modest holding period of 5 years, a 40% increase in price is required simply to cover the opportunity; less than that and you are making an effective loss. This may work for a few cases, but it's a big risk (and risky investments demand higher returns still).</blockquote>

[QUOTE="Balesir, post: 6291112, member: 27160"] Holding it in the expectation that it will gain in value is "making it work for you" - but it's a risky option with a significant payoff required before it becomes viable. The fact that it can pay off in a few cases is by no means a demonstration of overall advisability; even with a higher price after holding, you need to overcome opportunity costs and even several apparently "successful" cases have failed to do this. In the case of one of these I know about - Jimi Hendrix's music - I don't really think the holding was successful, even if an expected appreciation in value was the sole or main reason for holding (which I'm by no means convinced it was). Holding for, what, 30 years? That would require around a 10 times increase in value just to cover the holding cost. Did it really net [I]that much[/I] more? I'm sceptical. To be worth holding, the property must gain value [U]at least[/U] equivalent to the opportunity cost. The long term (nominal) return on stocks is currently around 7%. That means that, even for a modest holding period of 5 years, a 40% increase in price is required simply to cover the opportunity; less than that and you are making an effective loss. This may work for a few cases, but it's a big risk (and risky investments demand higher returns still). [/QUOTE]

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