ECONOMY & WORK
MONEY 101
NEWS
PERSONAL FINANCE
NET WORTH
About Us Contact Us Privacy Policy Terms of Use DMCA Opt-out of personalized ads
© Copyright 2023 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.
MARKETREALIST.COM / ECONOMY & WORK

Here’s Why Americans Love Real Estate When It Comes to Investing for the Long Term

Around 36% of the vote favored buying property, which was followed by stocks and mutual funds coming in at 22%.
PUBLISHED JUN 10, 2024
Cover Image Source: Americans believe real estate to be the best long-term investment. Getty Images | Photo by Justin Sullivan
Cover Image Source: Americans believe real estate to be the best long-term investment. Getty Images | Photo by Justin Sullivan

Investing may sound intimidating to people who have never done it before. For years, Gallup, the research and poll organization, has asked investors about the best long-term asset; since 2013, the answer has always been real estate. In 2024, around 36% of the vote favored buying property, which was followed by stocks and mutual funds coming in at 22%, gold at 18%, and savings accounts and certificated deposits at 13%. While 4% chose bonds, and 3% opted for cryptocurrency.

Real estate fraud. Pexels | By PhotoMIX Company
Real estate |  Pexels | By PhotoMIX Company

Real estate has always been pretty popular among investors who appreciate the great deal of flexibility that it offers. This means that not only can you use the property as your primary residence and still get a better deal when selling it later but you could also be treating it as a commercial property and make a new stream of monthly income. Apart from this, real estate is also great when it comes to tax benefits. You see mortgages are often tax-deductible which can be beneficial for a lot of people. On top of that, real estate is one of the few tangible assets, that can be seen and touched, unlike assets like bonds and stocks. This makes real estate even more appealing to investors. 

However, it's important to understand that the question asked in the poll can be a bit vague and can be perceived by people in many ways, per Gallup. For example, one can also invest in real estate by ingesting in real estate investment trusts, which trade like stocks, or ETFs that hold them. However, for most Americans investing in real estate likely means buying a primary residence, and as one pays down the mortgage they build equity in a piece of real estate that also appreciates. 

However, if we were to search for examples from the past, it looks like stocks have proved to be the better option time and again. According to the S&P CoreLogic Case-Shiller U.S. National Home Price Index which began in 1990, it was seen that residential real estate values have risen by 308% while home prices have quadrupled over the last three decades. However, when it comes to the stock market, the overall market rose by 1,325%.



 

"You can’t negate the compounding power of stocks over the long term for any investor, especially young investors," says Andrew Briggs, a wealth manager and director of portfolio management at Plaza Advisory Group, via CNBC Make It. 

The stock market also gets the edge when it comes to being beginner-friendly. A huge advantage of investing in the stock market is that it's pretty easy to get started where as investing in real estate needs a considerable amount of money.

Pexels | Photo by Binyamin Mellish
Pexels | Photo by Binyamin Mellish

However, for most people, long-term investment is more about stability and security than about getting the highest returns. Real estate can not only provide that but can also generate cash flow. On top of that, it can give you tax breaks and make you eligible for deductions. Moreover, investing in real estate can also be great if you are looking to diversify your portfolio. So, lastly, it depends on a household's needs, and one should take time to evaluate and weigh the sides to make a sound decision.

MORE ON MARKET REALIST
Guests on the show would run with it if they ever got that kind of money on Pawn Stars.
8 hours ago
The guest even said to keep the kids in the dark about how valuable these items were.
10 hours ago
The company had fantastic sales but a crushing debt with a high interest rate that the sharks hated.
13 hours ago
It was only Carey's second season in the show and he could have been part of a massive scandal.
1 day ago
“I won’t say anything, and you know why,” he said, with a gesture to zip his lips.
1 day ago
The ring was rescued by the guest's mother thanks to a stranger early in the morning.
1 day ago
"She blanked out. It happens to the best of us," a fan sympathized with the player.
1 day ago
The instrument originally belonged to the guest's grandfather who suffered a horrific injury.
2 days ago
The contestant's wife seemed embarassed at that point of time, and worried as well.
2 days ago
The co-founders of Dino Don got the shark that they always wanted on board.
2 days ago
One can understand why the measure is in place but the shopper was having none of it.
2 days ago
"My husband and I definitely noticed it! We had to rewind it a few times," a fan reacted.
2 days ago
All of the sharks agreed that she had a great product and the drive to be successful a businesswoman.
3 days ago
It's possible that the dog played a little part in making it easier for them to get a deal.
3 days ago
Without the help of his wife, the contestant would have gone home empty-handed.
3 days ago
The pawn store owner had a valid point since the item the guest had brought had numerous issues.
3 days ago
The contestant got the first part of the puzzle right but wasn't able to solve it in time.
3 days ago
"It's a lady's robe. A robe from 1750 is a very rare robe. The only other ones I know of this type, you'd have to go to Beijing," the appraiser said.
4 days ago
Harvey also got other hilarious answers, but nothing could match the woman's sass.
4 days ago
The Gronkowski family is famous for their contributions to America's sporting culture.
4 days ago