The only consistency that U.S. stock markets have shown of late is consistent volatility, much of it stemming from the serious financial instability that continues to rock the Eurozone. Thus, investors scouring for a safe place to grow their money over the long term might wish to consider real estate.
In his monthly update of the Return on Investment chart shown above, national real estate expert Steve Harney shows how the real estate market—even with its own volatility of the past several years factored-in—remains the better long term investment when compared with the major U.S. stock markets.
Using statistics culled from money.msn.com and the Case Shiller Housing Price Index, Harney’s chart compares the average return on investment for real estate compared to the Dow, S&P and NASDAQ for the period from January 2000 until June 1st, 2012.
For every dollar invested in real estate at the beginning of 2000 your return on investment would now be three times greater than the Dow; while your portfolio would have lost 8.3 cents on ever dollar invested in the S&P, and 30.3 cents on every dollar in the NASDAQ.
Property prices throughout Southwest Florida are as much as 40-50% below the artificially inflated levels to which they spiked during the boom. That’s why so many buyers and investors in search of value and stability have recently driven property inventories in our region to their lowest level since July 2005, during the housing boom. Still, our bottomed-out prices remain exceptionally low, even though they have been trending higher for the past few months.
In view of the diminished choice in properties, it may take longer to buy. But as Harney’s chart shows, your persistence in finding and buying the right property will very likely pay-off over the long term.