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Bankrate: Real Estate is Americans’ Favorite Long-Term Investment. Is This a Good Thing?

Real estate is Americans’ favorite long-term investment, according to a new Bankrate.com report. When asked…

  • August 11, 2017

Real estate is Americans’ favorite long-term investment, according to a new Bankrate.com report.

When asked the best way to invest money not needed for more than 10 years, 28% of U.S. adults replied real estate, 23% picked cash investments, 17% favored the stock market, 15% went with gold/other precious metals and 4% said bonds.

This is the fifth consecutive summer the survey was conducted and the third straight time that real estate came out on top (cash led the way the first two years).

It’s Smart to Invest in Stocks These Days

The stock market has never placed higher than third, which is particularly surprising because the S&P 500 is up more than 50% since the question was first asked in July 2013 and 16% since last year’s poll.

These figures do not include dividends, which can add substantially to an investor’s return over time, especially when reinvested.

“We’ve begun to see rising yields on savings accounts,” said Mark Hamrick, Bankrate.com’s senior economic analyst. “However, the preferences for cash and real estate indicate that too many people are leaving money on the virtual table by failing to be sufficiently exposed to the stock market, where higher long-term returns are found. This is especially the case for younger investors, who are in the best position to weather the inevitable short-term market volatility.”

Republicans and households with annual incomes of $75,000or more were the only demographic groups to select stocks as their preferred long-term investments.

Strangely, Baby Boomers and members of the Silent Generation were more likely to choose stocks than millennials and Gen Xers.

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