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Economy
Americans Still Favor Real Estate for Long-Term Investment
Economy

Americans Still Favor Real Estate for Long-Term Investment

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Chart: data points are described in article

Story Highlights

  • One-third of Americans say real estate is best long-term investment
  • Residents of the West, men especially confident in real estate
  • Stocks rank second, with strongest support from higher-income adults

WASHINGTON, D.C. -- Real estate remains Americans' top choice as the best long-term investment one can make, beating out stocks and mutual funds, gold, savings accounts and CDs, and bonds. This is the fourth straight year real estate has been the unrivaled favorite.

Trend: Americans' Choice of Best Long-Term Investment

At 34% and 26%, respectively, mentions of real estate and stocks are much higher today than in 2011 and 2012, when both sectors of the economy were still recovering from the 2007-2009 recession, including sharp downturns in the housing and stock markets during that period. However, the current 34% choosing real estate represents a leveling off of preferences for this investment after they increased in most years from 2013 to 2016.

Meanwhile, mentions of gold and bonds are lower today than in 2011 and 2012. In 2011, gold ranked No. 1, mentioned by 34% of Americans as the best investment, and bonds were favored by 10% -- twice today's level. But as and the housing market and stocks recovered, perhaps making bonds less appealing, the public regained its confidence in real estate and stocks.

Americans' preference for traditional savings accounts and CDs has been consistently muted since 2011 -- understandable given that interest rates have been at or near historical lows during this period.

Residents of West Show Most Confidence in Real Estate

Residents of the West are more likely than adults living in other regions of the country to consider real estate the best long-term investment. Forty-six percent of respondents in the West identify it as the best investment option, versus 33% in the South, 32% in the East and 24% in the Midwest.

Not only have housing prices recovered the most in the West in recent years, but after experiencing the steepest downturn in housing prices during the recession, residents of the West may feel especially enthusiastic about recent improvements in their local housing market.

Additionally, there are several demographic differences in attitudes toward investments that conform with what :

  • Adults in households earning less than $35,000 per year are less likely than those in more affluent households to value real estate and stocks, but more likely to value savings accounts/CDs.
  • Younger adults (aged 18 to 34) are far more likely than older adults to name savings accounts/CDs as the best investment.
  • Adults 55 and older are more likely than younger adults to consider stocks the best investment.
  • Men (22%) are more likely than women (13%) to see gold as the best long-term investment.
Americans' Choice for Best Long-Term Investment
Real estate Stocks/Mutual funds Gold Savings accounts/CDs Bonds
% % % % %
Men 37 23 22 10 6
Women 32 29 13 15 4
18-34 35 24 12 21 5
35-54 37 23 20 10 6
55+ 32 30 21 9 3
$75,000 and over 38 35 13 7 5
$35,000 to $74,999 36 23 19 13 5
Less than $35,000 27 17 22 19 6
East 32 29 19 9 7
Midwest 24 28 17 19 5
South 33 26 17 16 4
West 46 23 18 6 5
ºÚÁÏÍø, April 5-9, 2017

One reason more Americans don't mention stocks is that barely half of adults . Stock ownership is also strongly related to age, perhaps explaining why young people are not as confident as older adults are in stocks as a long-term investment.

Bottom Line

Americans' perceptions of the best place to put their money for the long term are similar to 2016, but have shifted since 2011 in line with ups and downs in real estate, the stock market and gold prices.

After trailing gold in 2011, real estate worked its way up the rank-order of preferred investments and has led the list since 2014. Stocks have been alone in second place since 2015, with gold slipping to third.

Still, despite meaningful increases in housing prices and stock values over the past year, Americans' preferences for real estate and stocks have held fairly steady, possibly a sign of residual caution on consumers' part. As long as the economic shocks of the Great Recession remain a vivid memory, preferences for these may not swell much further.

Survey Methods

Results for this ºÚÁÏÍø poll are based on telephone interviews conducted April 5-9, 2017, with a random sample of 1,019 adults, aged 18 and older, living in all 50 U.S. states and the District of Columbia. For results based on the total sample of national adults, the margin of sampling error is ±4 percentage points at the 95% confidence level. All reported margins of sampling error include computed design effects for weighting.

Each sample of national adults includes a minimum quota of 70% cellphone respondents and 30% landline respondents, with additional minimum quotas by time zone within region. Landline and cellular telephone numbers are selected using random-digit-dial methods.

View survey methodology, complete question responses and trends.

Learn more about how the works.


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