From the course: Pre-investing: Before Investing in Real Estate

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Why invest in real estate?

Why invest in real estate?

- I'm sure you've heard experts talking about how stocks have, over the long run, outperform real estate. What they don't tell you is that the comparison isn't usually an apples to apples comparison. Taking stock market data from 1950 to 2009, the return overall from the stock market, looking at the Standard & Poor's 500 Index, which is a basket of stocks that gives a good overall representation of the stock market and factoring in the dividends and adjusting for inflation, you get about 7% almost exactly in terms of the return. And but don't take my word for it. That's coming from Warren Buffet who says that you get about six to 7% return from the stock market. Now, if you average 7% return a year on your investments, that's actually really good. You're essentially doubling your investment every 10 years. So over, say, 40 years, you're getting almost 15X for your investment. You could turn 100,000 into 1.5 million. But know…

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