S&P 500 Returns Double US Home Prices Over 50 Years
Since 1975, the S&P 500 has averaged a 12.2% annual total return versus 5.1% for US home prices, highlighting stocks' superior long-term wealth creation.
According to data cited by The Kobeissi Letter, US stocks have significantly outperformed housing over the long run. From 1975, the S&P 500 delivered an average annual total return of +12.2%, more than double the +5.1% gain in US home prices over the same period.
Even without reinvesting dividends, the S&P 500 still averaged +9.3% per year, beating house price appreciation. After adjusting for inflation, the gap widens further: the S&P 500's real total return stands at +8.3% annually over 50 years, nearly six times the +1.4% real return of US home prices.
The S&P 500 excluding dividends and adjusted for inflation has returned +5.4% per year on average. These figures underscore that stocks have been a far more powerful driver of wealth creation than housing.
Source: The Kobeissi Letter