Real estate remains America’s favorite long-term investment

NEW YORK – Real estate still tops the list of Americans’ favorite ways to invest money they don’t need for 10 years or more, ranking first for the third time in the past 4 years, according to a new survey from The 29% pointing to real estate are just behind the 31% in 2019 in 10 years of survey.

Preference for the stock market has fallen from levels a year ago to 26% from 16%, although the stock market is down more than 20% year-to-date at the time of the poll. This year’s 26% trail only 2020 (28%) and 2018 (32%) in the 10 years of poll results.

“Despite a boiling housing market, the preference for real estate remains high,” said Greg McBride, CFA, chief financial analyst for Bankrate. “For the 3rd time in the past 4 years and the 6th time in the past 10 years, real estate is the preferred way for Americans to invest money they haven’t needed in over 10 years. Despite a brutal bear market in 2022, the stock market has followed closely. »

Liquidity comes in third place, which has fallen from 25% last year to 17% this year, even as interest rates rise.

McBride added: “The preference for cash has moderated noticeably, cited by just 17% of respondents, the lowest seen in a decade of polling. Nothing like the highest inflation in more than 40 years to remind investors of the need for higher returns to increase the purchasing power of a nest egg.

In the worst year for memory bonds, they were cited by 9% of respondents, the highest in 10 survey years and up from 4% last year. An inflation-linked savings bond (I-bond) gaining 9.62% at the time of the poll could largely explain this.

Gold and other precious metals were also cited by 9% of respondents, down from 13% last year and 9% in 2018, the lowest level seen in a decade of polls.

The cryptocurrency was cited by 6%, down from what was so far a peak of 9% last year. Finally, 3% said none of these would be the best place to invest money for the next decade or more.

Among those who did not choose the stock market as their preferred investment for the next 10 years or more, when asked the main reason why the most important answer is “too much volatility” (36%). Other less common responses included being “intimidated by the stock market (16%), feeling that returns won’t keep pace with other investment options (15%) and believing that “the stock market is rigged against individual investors” (14%), the emphasis on preserving money already invested rather than growing it (10%), or “some other reason” (9%).

Comfort levels with investing in cryptocurrency have plummeted, and so have prices. Only 21% of Americans are comfortable investing in cryptocurrencies such as Bitcoin – including 16% who are somewhat comfortable and 5% who are very comfortable – compared to 35% last year .

Three in four (75%) are uncomfortable investing in cryptocurrencies, up sharply from 61% last year. This includes 29% who are “a little uncomfortable” (little change from 28% last year) and a notable increase to 47% from 33% last year who say they are “not comfortable at all”.

Of all generations, millennials have the greatest preference for real estate for money they haven’t needed for 10 years or more, consistent with findings from previous years. Millennials, Generation Z and Generation X prefer real estate over other options. Baby boomers are an exception, preferring the stock market (33%) to real estate (25%). Baby boomers’ preference for the stock market has also surpassed that of all other generations.

As for those who do not prefer the stock market for long-term investments, volatility resonates more with Baby Boomers (44%) and Gen Xers (40%) than Millennials (29%). Being intimidated by the stock market was cited by 22% of older millennials, 18% of younger millennials, and 15% of Gen Xers.

Comfort levels with investing in cryptocurrencies such as Bitcoin are highest among younger investors, with 34% of Gen Z and 29% of Millennials saying they are somewhat or very comfortable. Comfort levels decline steadily with age, from 21% among Gen Xers to 15% among younger baby boomers (58-67 years old) and just 4% among older baby boomers ( 68-76 years old). It’s worth noting that even among the youngest investors, 66% of Gen Zers say they’re not too comfortable (37%) or not at all comfortable (29%) with investing in cryptocurrencies.

Methodology: This study was conducted by SSRS on its Opinion Panel Omnibus platform. The SSRS Opinion Panel Omnibus is a nationwide, probability-based, bimonthly survey. Data collection was conducted from June 17 to June 20, 2022, with a sample of 1,025 respondents. The survey was conducted via the Internet (n=995) and telephone (n=30) and administered in English (n=1000) and Spanish (n=25). The margin of error for all respondents is +/- 3.5 percentage points at the 95% confidence level. All SSRS Opinion Panel Omnibus data is weighted to represent the target population of US adults aged 18 or older.

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