The difference is you could have lived in that house or rented it out and created additional income. In the book &#x27;Ascent of Money&#x27; Niall Ferguson does a breakdown on the housing market in London vs investing in the stock market through index funds and shows how housing really was one of the better investments. It&#x27;s worth checking out the book for that section.<p>The issue I see is that hindsight is always 20-20 so even if housing was the better investment in the past, I still wouldn&#x27;t want most of my savings&#x2F;wealth to be invested in an asset that isn&#x27;t very liquid and is susceptible to swings in the market. However, if you buy in a place like London or San Francisco those swings are probably only minor setbacks if you&#x27;re in it for the long haul.