A 2016 Bankrate national survey found that a majority of Americans choose real estate as their top investment for money they don’t need for 10 years, followed by cash investments, then followed by gold and stocks.
So in this article, we want to share the results of Bankrate’s survey, while also adding some thoughts as a premiere Tampa Bay real estate investment group.
Decreased Confidence in Stocks
Although we have been in a bull market since 2009, confidence in stocks as an investment remains low. A Bankrate survey in 2014 showed that only 14% of Americans thought stocks were the best long-term investment, which only rose to 16% in 2016.
Many investors are turned off by a lack of transparency with stocks, because of the uncertainty of where their money is going. Professor of Finance at the University of California, Davis, Brad Barber, believes suspicion is the main reason why confidence is lagging in the stock market.
Real estate investing, on the other hand, offers investing in tangible assets that can be controlled by the investor, who decides where every penny of his investment goes.
Perception of Finances in America
While confidence in the stock market remains low, the general consensus in the U.S. is that people are satisfied with their financial well-being.
For 26 months in a row, the Bankrate Financial Security Index (a survey based on how people feel about their debt, savings, net worth, job security, and overall financial situation) shows that American’s sense of financial security continues to improve.
This sense of security may also explain why a majority of Americans believe real estate is the best investment for money not needed for at least 10 years. When people feel secure about their own future, and the future of the nation at large, they are more likely in invest in tangible assets for the long term, rather than worry about liquidity.
How Millennials Feel
While the overall trend is toward investing in real estate, millennials are far and away the largest group to view cash investments as the most secure option. Around 32% of people ages 18-35 endorsed cash, and that number jumped to 43% for ages 18-25.
The common consensus appears to be that millennials do not trust the market. However, many financial analysts are worried about this perception since cash deposits are not nearly as effective as other types of investments.
While cash protects investors against loss, it does not protect them from inflation. Over time, the only thing that happens to cash is that it loses value.
Graystone Investment Group
Graystone Investment Group is an experienced real estate wholesaler in metro Tampa Bay, helping clients generate profits with real estate investments that can help manage volatility and protect against inflation.
Unlike other investment groups, we find properties that we resell to investors at discount prices, while also connecting them with private financing. We also coordinate with rehab and management companies we’ve worked with for years, at no extra charge.