(Brought to you by the folks who also recommended Beanie babies, Internet stocks, and Worldcom as the best long-term investments a person can make)
Even as a five-year slump in house prices drags on, eight-out-of-10 Americans say bricks and mortar remain the best long-term investment, according to a study released on Tuesday.
The survey by the Pew Research Center’s Social and Demographic Trends project found that 81 percent of respondents see housing as the best investment a person can make, despite a slump in prices that has knocked nearly a third off home values since 2006.
“The resilience of the American public’s belief in the investment value of home ownership is pretty impressive,” Paul Taylor, the project’s director and a co-author of the report, told Reuters.
“In modern economic history we’ve never had a five-year period where home values have fallen as long or as far as they have now,” he added.
It found that 37 percent “strongly” agreed that a home is the best long-term investment a person can make, while 44 percent “somewhat” agreed that homeownership is the best investment a person can make.
When the same questions were put to respondents in a CBS News/New York Times survey two decades ago, 49 percent “strongly agreed” that homes were the best investment, and 35 percent “somewhat agreed,” the study noted.
Nearly half of all homeowners said that their home was worth less now than before the recession began in late 2007, the survey found.
Of that group, the overwhelming majority said it would take at least three years for values to recover, while nearly half said it would take at least six years to recover.
From the WSJ:
Despite an extended slump in real-estate prices, most Americans still believe homes are the best investment, according to this a survey released today by the Pew Research Center.
According to the results of a telephone survey conducted in March, Pew found eight-in-ten adults believed a home was the best long-term investment a person could make.
This isn’t to say that Americans faith in real estate is unflappable. The “intensity” of the public’s faith has fallen off, according to the survey, with 37% of respondents saying they “strongly agree” that homeownership is the best investment, compared with 49% from a CBS News/New York Times survey conducted two decades ago, Pew said.
There is also some evidence that the next generation views real estate with a more pessimistic eye. According to Pew: “Adults ages 65 and older are more sold on the investment value of homeownership than any other age group. Some 48% of this older cohort agree that homeownership is the best long-term investment a person can make, compared with 39% of those ages 50 to 64; 32% of those ages 30 to 49; and 35% of those ages 18 to 29.”