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Which is a better investment Stocks or Real Estate

By Alison Moss

Real Estate Agent with Keller Williams Seven Hills

June 15, 2010 02:06 AM

Which is a better investment Stocks or Real Estate

If you had invested $100,000 in the stock market in the 1^st quarter of 2000 (10 years ago), what would your investment be valued at today? Of course the answer would depend on what the specific stock or stocks you bought, but consider this:

The Dow went from 10,921 on January 3, 2000 to 10,583 as of Jan 3, 2010 — and at this writing it’s hovering around 10,186. So, $100,000 invested in a DJIA-like stock portfolio ten years ago would now be worth less than $100,000. See the DJIA information for reference.

By comparison, the average house purchased for $100,000 in the Cincinnati-Middletown-OH-KY-IN MSA during the 1^st Quarter 2000 would have been worth $122,438 in the 1^st Quarter of this year. Click here for FHA data. Of course, all real estate is local and just as stock appreciation depends on the particular stock, real estate appreciation depends on the particular property.

So, which was a better investment? You be the judge. Besides, everybody has to live somewhere!

Posted on Jun 03 in Cincinnati Real Estate, Investment Property, Investment Real Estate, Property Value
Tagged: 10 years, Cincinnati, djia, dow, FHA, investment stocks, msa, real estate appreciation, st quarter, stock appreciation, stock market, stock portfolio

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Kellie Morrissey

Keller Williams Realty Success LLC - Littleton, CO

CO Realtor CRS, GRI, CDPE

I think it's going to be interesting after the talked about market regulations are put into place. In my opinion there is going to be a spike in real estate investment vs the stock market after the regulations are completed.

Great post!

Jun 15, 2010 02:10 AM

Al Raymondi

Ocean View Realty Group in Ormond By The Sea Florida - Ormond Beach, FL

Ormond By The Sea Florida - Home and Condo Sales

Great post Alison we should all look at the figures for our area and publish something similar.

Jun 15, 2010 02:39 AM

Bob Willis

Berkshire Hathaway HomeServices California Properties - Orange, CA

Orange County & L.A. County Senior Home Advisor

Also take into consideration that most people don't pay 100% cash for a home, but they do pay 100% cash for stocks. If you buy a home for $100,000, you may finance it with an FHA loan, which means your out of pocket down payment was $3,500. So, on an investment of $3,500, your gain of $22,438 is more than 600%. How many stocks will give you that much improvement on your investment?

Of course, you may also have closing costs, unless you get the seller to pay them.

Oh, and by the way, you won't be paying rent so your landlord can pay his mortgage.

One more thing, you are also paying down the principle, so you are gaining equity, even in a flat market.

Jun 15, 2010 03:25 AM

Which is a better investment Stocks or Real Estate

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