Your stock is a piece if paper. Your investment can disappear like it was never there. Real estate is quite the opposite
Tell me, how does an investment simply "disappear like it was never there"?
Its interesting to discuss the Stock Market vs. Real Estate, and the statement that buying stocks is a much better idea. I personally believe in a balanced approach and that stocks and real estate are important investments that need a place in a person's savings and investment portfolio.
We have seen the Dow hit 20k, which is quite an exciting accomplishment, and I wonder how long it will take to hit 30, 40 and 50k. I hope to see these numbers in my lifetime. I bet we will.
However the indexes are rigged so of course these numbers will continue to grow and outperform real estate and other investments. Today we have great companies like Disney, Microsoft, Apple, Visa, Pfizer, etc. But using the example of buying the house in 1981, if instead you had bought great DOW companies of the day such as Eastman Kodak, Sears Roebuck, Woolworths, or American Can Company you might have regretted those investments. In 30 years from now, the greatest companies of today will most likely suffer the same fate, as they decline and new companies take their place.
The Dow touched 1000 in Apr 1981, so if you had dropped 181k into a DJIA ETF (not sure if that type of fund existed back then) you would have 3.6M today...However more likely you only had a 25% downpayment, so if you took 45k and put that into the fund, you would have 905k today. That would be considerably less if you had purchased those 30 DOW companies individually.
So its difficult to compare blindly the differences between different investment types. Sure if you were able to follow Warren Buffets investments over those years, you would have done extremely well, but on the other hand if you underperformed the market by a few percentage points, or maybe you put all your eggs in the Nortel basket, flying high in the 90's...things could be very different.
Real Estate should be a slow and steady wealth builder, and has proven over the long term to be a great hedge against inflation, a way to leverage your downpayment and turn it into a healthy nest egg over a person's lifetime. The Stock Market can be the same, but generally is a much wilder ride, especially over the past 10 - 20 years, its quite difficult to play the game as a minnow swimming with the big sharks.
Much of the Boomers wealth was generated through Real Estate and the simple idea of purchasing a family home to raise a family. Some Boomers did great in the Markets, but I would say most of the wealth was a result of buying a home with a slow and steady forced savings plan, paying that mortgage down over 25 years. This was helped along by Inflation, which in real terms made their debt smaller and lowered the mortgage payment vs. that slow increase in the home's value.
What happens next...my bet is that in the long term it won't be much different for the next generation.