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galeno wrote,

Over the last 30 years, the typical one-family house in the USA compounded at 5.71% per year.

Other 30 year CAGRs: Gold 7.11%. Silver 5.04%. Crude oil 6.3%.

How has the S&P500 done over the last 30 years? 13.67% per year. And over the last 45 years? 13.41% per year.

Stocks are liquid and RE is not. Stocks are movable and RE is not. Stocks don't call you at 3 AM to fix the toilet but RE tenents do.


I was looking for those comparative investment returns when this thread started yesterday. Could you post the source of your figures?

I would add two items to your list of real estate disadvantages:

1) Diversification. It's easy to build a diversified portfolio of stocks, but very hard with real estate. Most RE investors only buy properties in their home town. Managing real estate at a distance adds expenses that reduce your return.

2) Transaction costs. You can buy or sell $1 million worth of stock for a $10 commission. The 6% commission on a $1 million home is $60,000.

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