Assuming low inflation and stable inflation rates, HOST is unnecessary for many prospective middle-class buyers because investments such as money market accounts, certificates of deposit, zero coupon bonds, tax-free municipal bonds, mutual funds, stocks and equities provide after-tax rates of return greater than housing price increases in most middle-class areas.

A first-time buyer in Battle Creek, Midland, Saginaw or any other area where housing prices are increasing at an annual rate of five percent or lower could obtain a sufficient after-tax rate of return through a money market account, certificate of deposit or taxable zero coupon bond.

Buyers in portions of Downriver, Flint, Kalamazoo, Lansing and other areas where housing prices are increasing at an annual rate of five to seven percent could obtain a sufficient after-tax rate of return from tax-free municipal bonds. A portfolio of eight AAA- and AA-rated tax-free bonds maturing in 1995, 1996 and 1997 was paying 6.23-6.86 percent in late December.

A first-time buyer in Holland, Jackson, Monroe and other areas where housing prices are increasing at an annual rate of seven to eight percent could obtain a sufficient after-tax rate of return from certain mutual funds, stocks and bonds.

Buyers in certain upscale areas where prices have exceeded the state housing index could also obtain a sufficient after-tax rate of return from certain mutual funds, stocks and bonds.

All of the aforementioned investments have established secondary markets.