If you want to take advantage of the best investment in current times you need to think about investing in a new or pre-existing home, at least that’s the current belief of one in four Americans.
With interest rates at historic lows, a new study by Bankrate.com found that 27 percent of 1,000 investors all agreed that homeownership is the best investment the average American can make based on current market conditions.
Those investors believe that investing in a home is a smart move if you will not need access to your cash for at least the next decade. Cash took the second spot with 23 percent of investors, followed by 17 percent who believe the stock market is the way to go, and 5 percent who stood behind long-term bonds.
The study, an ongoing examination by Bankrate, has not listed real estate at the top of its list in the last three years. Cash was a favorite among Americans in both 2013 and 2014.
“It begs the questions if more Americans are once again viewing real estate as a golden ticket,” said Greg McBride, chief financial analyst for Bankrate.
Experts do warn that real estate isn’t as easy to sell if cash is needed. Plus, investors must pay for insurance, maintenance and property taxes that can eat into profits if the ultimate goal is a quick sale.
“You can’t sell real estate short so you cannot hedge against a down market and the market for real estate is too local,” Wes Shannon, a certified financial planner with SJK Financial Planning in Hurst, Texas tells Yahoo Business. “You may live in a state or city going through an economic boom, but if the other houses on your street start to decline or convert to rentals you can see a depreciation of your [home] value … even one bad neighbor can ruin an investment in real estate.”