When No One is Interested in Equities

Compared to real estate investing, stocks seem like the proverbial red-headed step child. No one is talking about stocks and real estate is getting all the media attention. In my opinion, the lack of interest by the public in stocks implies they might be reaching an “oversold” condition.

[Still, the historical real estate data show blips and dips, but over years they tend to smooth out to an upwards-trending curve--just like equities. Even where they do decline, however, real estate prices tend to be stickier on the way down than on the way up, because home owners are more reluctant to sell in downturns.

"Historically, the largest real home price decrease is on the order of 5% in any given year," says Jonathan McCarthy, senior economist at the Federal Reserve Bank of New York. "Whereas you talk about a real stock-price decline, you could probably see 20% or even more."]