By John Cabezas with LIV AZ Realty
In 2020, just like every other year, Gallup conducts its top investment survey. In this survey they ask Americans what their investment choices for the long term are, and how well they’ve performed. Those surveyed are asked to select form several choices such as savings accounts, CDs, bonds, stocks, mutual funds, gold, silver, and real estate.
The top performer, for seven years running, is real estate. Real estate has consistently come in on top as the best long-term investment. Since 2011, real estate has been consistently strong and has provided many Americans with a sound investment and financial stability. Real estate owned equity (Americans’ private homes) has grown substantially during that same period.
According to Gallup, “Real estate remains the most favored investment to Americans, as has been the case since 2013, when the housing market was on the rebound. More than a third of Americans have named real estate as the top investment since 2016.”
Highlights of the Survey:
• 21% say stocks are the best investment, down six points from 2019.
• Appeal of stocks fades in high- and low-income households alike.
• Still, U.S. stock ownership remains stable at 55%.
“Americans have become less likely to view stocks or mutual funds as the best long-term investment after U.S. markets dropped by more than a third as the economic implications of the coronavirus outbreak set in last month,” cites Gallup. “The current 21% naming stocks as the best investment is down six percentage points from last year and is the lowest Gallup has recorded since 2012. Real estate continues to rank first, while gold and savings accounts trail stocks.”
Americans still choose real estate as their long-term investment strategy. The COVID-19 pandemic continues to erode Americans’ confidence in the stock market, and has lead them to other investment choices, primarily real estate.
For those of you that remember the Great Recession of 2007, this time, instead of real estate being the catalyst, it has become the savior. Despite the massive unemployment, business bankruptcies, severe drops in the market and wide spread panic, real estate continues be strong and leading the recovery.
The results covering the last decade of surveys and performance are shown in the chart below:
The bottom line: There are those that believe the stock market is the best place to invest long term. This may be true for those that understand the market and have time to watch it closely, or have an investment manager that stays on top of their investments. But for most Americans, that is not an option. The vast majority of Americans garner their wealth from real estate investments and the equity from their private home.
Despite a pandemic and political uncertainty, the residential real estate market in the Phoenix metro area continues to thrive. Because of this, we are launching the OUR HEROES giveback program to serve the local community and front workers during the pandemic. The program is designed to give back to local community heroes by reducing the cost of buying a home.
Participants do not have to earn hero status to participate. They are already designated a hero if they work for, or are retired from, our list of eligible industries: firefighters and EMS; law enforcement and staff; medical professionals and staff; military (active, retired and veterans); teachers and educational staff; grocery workers and administrative staff; delivery workers; childcare workers, and pharmacy workers. On average, OUR HEROES participants receive $2,500 in discounts. Visit livazrealty.com to learn more.
A Cuban born immigrant and businessman, John spent 25 years as an executive in corporate America, has co-written a real estate ‘How To’ book, is a three-time guest on Real Estate Matters (960AM) Talk Show and is currently a partner and Realtor at LIV AZ Realty. In his 20 years as a Realtor, John has been involved in major remodel and renovation projects throughout the valley. View his real estate blog at livazrealty.com.