Which is a better investment: buying a home or investing in stocks?
Since 1995, stock prices have outperformed home prices by a factor of four, but which is actually the better investment for building wealth?
Gallup conducts an annual poll to determine America’s most popular long-term investments.
In nearly 20 years of polling, Americans have never picked stocks.
Financial experts regularly choose the stock market as the best investment destination for long-term gains. Fidelity reports that over the 40-year period ending in 2025, the S&P 500 returned an average of 11.5% per year.
Yet, when Gallup asks Americans to name the “best long-term investment” in its regular polls, stocks have never topped the list.
In a 2026 poll, respondents were asked to choose among the six “best” long-term investments, and the top answer was real estate by a wide margin. The breakdown is as follows:
- Real estate, 38%
- Stocks/mutual funds, 20%
- Gold, 18%
- Savings account/CD, 12%
- Bonds, 4%
- Cryptocurrency, 2%
Gallup has asked more or less the same questions every year since 2007. Real estate has topped the survey every year since 2013.
But before 2013, investors had a very different answer.
Americans’ preferred investments have changed over time
In 2008, as the Great Recession deepened, a Gallup poll found that Americans chose frugal savings accounts (and certificates of deposit) as their favorite long-term investment.
In 2008, neither stocks nor housing seemed like very safe investments. Due to the housing market collapse, the S&P 500 lost nearly 40% of its value that year.
“Nothing performed well during the Great Recession, and that’s why savings accounts won,” said Matt Frankel, a certified financial planner with The Motley Fool.
In 2011, Gallup added gold as an investment option to its research. Gold won the “Best Investment” contest that year and the following year.
Investors have a love-hate relationship with stocks.
Investment experts say the survey results, more than anything else, prove that U.S. investors don’t have full confidence in the stock market.
“From 2007 to 2009, investors had a very poor experience with stocks,” said Christine Benz, director of personal finance and retirement planning at Morningstar. “It can be hard to fall in love with stocks.”
These days, experts say Gallup polls show Americans’ love for housing.
Compared to fickle stocks, real estate feels like a stable investment. Home prices fell dramatically during the Great Recession, but the decline was extraordinary. Over the past several decades, home prices have mostly been on an upward trend.
“Real estate has historically gone up almost every year,” Frankel said. “Real estate has rarely gone backwards in history.”
However, safe doesn’t always mean better when it comes to long-term investing.
What is the best long-term investment?
According to Frankel, Benz, and other investment experts, if there’s one answer to the Gallup poll’s question, it’s stocks.
Over the past 30 years, stock prices have risen four times faster than home prices, according to Motley Fool analysis.
“The best long-term investment is definitely the stock market,” said Caleb Silver, editor-in-chief of Investopedia.
Here’s another way to compare stocks and real estate as investments. According to Investopedia, from 1992 to 2024, the S&P returned an average of 10.4% per year. In the same year, house prices rose by about 5.5% annually.
“I’m surprised that stocks haven’t become a more consistent favorite,” Benz said in the Gallup poll. “Because the data shows that equities are clearly outperforming all other asset classes.”
Why do Americans prefer real estate as an investment?
So why do Americans consistently choose real estate as the “best” investment in Gallup polls?
One reason is that Americans are more likely to own homes than stocks.
About two-thirds of American households own their primary residence, according to the most recent 2022 Federal Consumer Finance Survey. In contrast, only 21% of households have “direct ownership” of stocks in their name.
Frankel said real estate is “an investment that most survey respondents understand.”
For many Americans, a home functions like a savings account. When you buy a home with a mortgage, you enter into a multi-year cycle of building equity through mortgage payments and the gradual appreciation of the home’s value. Homeownership has helped millions of Americans achieve the American Dream.
A home feels like a safe investment. The same goes for savings accounts, CDs, and gold, an asset class that briefly topped Gallup polls during the Great Recession.
“Older generations have traditionally felt that gold and real estate are better investments than the stock market, because they’ve lived through stock market crashes and seen their wealth evaporate,” Silver said.
How is gold valued as a long-term investment?
Gold looks like a great investment these days. At one point in early 2026, the price of gold was up about 75% in one year and 200% in five years. Gold outperformed stocks.
Since then, gold’s value has fallen, and the recent rally is unusual. Adjusted for inflation, gold was worth about the same in late 2024 as it was in early 1980.
Is gold the best long-term investment? Probably not, investment experts say. Works better as part of a diversified portfolio.
“A small amount of gold can actually help with diversification, so it’s worth considering,” Benz said. “But I think investors should avoid either of these scenarios.”
Are savings accounts and CDs good long-term investments?
Investment professionals typically recommend savings accounts and CDs only for investors with a very low risk tolerance or who are looking for a way to hedge against stock volatility.
Many of the best high-yield savings accounts and CDs have annual interest rates of around 4%. That means your money will roughly keep up with the current annual inflation rate of 4.2%.
