Stocks vs. Real Estate Investing
For the past many years, real estate has provided a hefty return for those who got involved early enough. Real estate has appreciated 12.4% annually between 2001 and 2006, according to the S&P/Case-Shiller U.S. Home Price index. That beats out stock prices, which gained only 4.3% a year as measured by the S&P 500.
So which contender is the superior long-term bet today? CNN Money has an interesting article talking about this and Robert Shiller, author of Irrational Exuberance seems to think the real estate boom is over.
You can also read some interesting information about the 100 biggest real estate markets. McAllen, Texas is predicted to have the highest return thru the next year at 9.8%. Now this data is for single family homes and doesn’t affect the multi-family home investor. I only purchase multi-family homes (apartments, duplexes, fourplexes) since they are a safer investment. Less volatility and one vacancy doesn’t mean 100% vacancy.