A: In any given time period, stocks can outperform real estate or vice versa. Our blog post: Rental Properties vs. The Stock Market goes through an example of an actual property based on actual expenses and anticipated growth rates. A balanced portfolio of stocks and bonds, held for 30 years with no leverage, is likely to equal or possibly even exceed the 6.64% that our real estate investor (also with no leverage) is expecting in our example. Another consideration that favors stock portfolios over real estate is that a stock/bond portfolio is less hassle and more liquid. That being said, there is still a place for real estate. It is a good diversifier to be held in addition to stocks, bonds, and other asset classes. It also can provide tax benefits from interest expense and depreciation deductions.