Stocks Or Real Estate? One Segment of the Population Is Not Bullish on Housing

Stocks Or Real Estate?

Gen X’ers and older Millennials (35- to 44-year-olds) were hit hardest by the housing bust just as they reached prime first-time home-buying age.

Less than half of homebuyers and sellers between the ages of 35 and 44 believe that real estate is a better long-term investment than the stock market, according to a survey from Redfin (www.redfin.com), the next-generation brokerage. In December 2018, Redfin surveyed more than 2,600 people nationwide who at the time bought or sold a home in the last year, attempted to do so, or had plans to buy or sell in the near future.

Buyers who reached the median first-time homebuyer age of 31 years old between 2008 and 2012 during the Great Recession and housing market collapse are now 37 to 41 years old. Redfin’s survey results show that this was the only age group that has less confidence in real estate as an investment than the stock market. Just 48 percent of homebuyers and sellers in this age group believe that real estate is a better long-term investment than the stock market.

Which is a better long-term investment?

Age Range

< 25

25-34

35-44

45-54

55-64

>=65

Real estate is better

59%

57%

48%

60%

62%

56%

The stock market is better

41%

43%

52%

40%

38%

44%

“The oldest Millennials and youngest Gen-Xers entered their late twenties or early thirties during the housing crash, which explains why they are more skeptical about investing in real estate,” said Redfin chief economist Daryl Fairweather. “This generation experienced a major setback during the housing bust, which hit just as they were most likely to be getting married, starting a family, and becoming a first time homeowner. Looking into the future, we expect to see homeownership increase as Millennials enter prime home-buying age. This is because Millennials have a more favorable opinion of real estate as an investment than Gen-Xers, and Millennials are a larger group than Gen-Xers.”

In every other age group, buyers and sellers who believe that real estate is a better long-term investment outnumbered those who believe the stock market is better. Younger Baby Boomers, respondents aged 55 to 64, were the most optimistic about real estate as an investment.

For the complete report and methodology visit: https://www.redfin.com/blog/2019/01/millennials-stocks-better-investment-than-real-estate.html.

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After earning her bachelor’s degree in journalism at the University of Central Florida, Tracey set out in the real world at Florida Realtors in 1994 as a communication assistant, working her way up to editor in chief of Florida Realtor magazine. In 2004, she left the association to start her freelance writing and editing business. One of her first clients was REAL Trends, and she started working for the organization in 2005. In 2014, Tracey was promoted to editor in chief of publications for REAL Trends. She handles the writing and editing of all REAL Trends publications and marketing materials, including LORE Magazine, the REAL Trends newsletter and the blog. She is also the primary podcast interviewer where she conducts interviews with top real estate industry leaders and affiliated industry leaders. Tracey is married with two children.

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