Monday Market Update: Are Homes or Stocks A ‘Better’ Investment?

December is flying by and 2026 is almost here! Today’s topic is a timeless one that can be talked about in any month, season, year, decade or era: Are homes or stocks a ‘better’ investment? That is the question recently proposed by USA Today in a just-posted Money segment. See 5 things to help you weigh the wisest investment for you and read the article in full here: “Which is the better investment, stocks or a home? Answers here.” 

*Please note this article is intended for informational purposes only and is not to be considered financial guidance or advice. Please be sure to consult with your own trusted financial advisor, wealth manager, real estate agent and tax professional to make the very best decisions for you!

5 Things To Know About Homes & Stocks

Two Investment Types, Countless Different Benefits & Risks 

#1:  Since 1995, stocks have risen by about 1,200% while home prices have risen 310%. From 1992 to 2024, the S&P yielded an average return of 10.4% a year, while home prices grew about 5.5% per year. (Note that home price growth is hyper-local and these figures represent national averages.) 

#2:  Stocks tend to have greater volatility than home prices. Home prices rise and fall but have not really declined in the last 10 years. The S&P has lost as much as 18% in a single year. 

#3: The stock market is strictly a wealth-generator. A home is an asset, an investment… and ‘your castle.’ From a performance perspective alone, stocks generate more long-term wealth according to many advisors. However, you also need a place to live, thus homes are an investment and shelter. Similarly, stocks have less direct lifestyle impact – while a home you love and make your own is oft-considered the biggest lifestyle 'booster' there is. 

#4:  A home is essentially a ‘forced’ savings and cannot lose all of it’s value as it is a physical asset. A stock is not a physical asset and thus considered by some a ‘less stable’ investment.’ 

#5:  There are generally more tax benefits to home ownership since you can generally deduct mortgage interest and property taxes, plus avoid up to $250,000 per person ($or $500,000 for married couples) in capital gains. Investors who sell at a profit generally do face capital gains taxes. 

There are many other considerations in weighing whether homes or stocks are the wisest investment for you. Personal preferences, priorities, time to build wealth, retirement age… these are just a few of the additional factors that may impact your choice. As you plan to live your best life in 2026 and beyond, we hope you surround yourself with a vetted team of financial professionals and take into account your own comfort level and needs. You got this!

Cheers,

Bobbi 

Bobbi Decker
DRE#00607999

Broker Associate, Bobbi Decker & Associates
650.346.5352 cell
650.577.3127 efax
www.bobbidecker.com
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Bobbi Decker & Associates fully supports the principles of the Fair Housing Act and the Equal Opportunity Act. For more information, please visit: http://portal.hud.gov/