My house is many things, but from outward appearances it's mostly a cross between a book depository, a recycling center and a biology lab that can't afford Petri dishes and decided to use leftover plastic ware from Chinese take-out.

One thing a house isn't is an investment. But trying telling that to the folks who answered a recent Gallup poll, where "real estate" ranked as the best investment, followed by gold, stocks, savings accounts and CDs. (For some reason, the list omitted Mason Jars, lottery tickets and Serta Perfect Sleepers.)

After the bursting of the real estate bubble, you'd think that people would forget the old-fashioned notion that a home is your best investment. No, an investment is your best investment. And, as the saying goes, you should never invest in anything that eats or needs maintenance -- which makes a diverse portfolio of stocks perfect, since you never need to muck out its eaves troughs or cut its lawn, although, from time to time, it does need pruning.

Out (of money) at home

Take a look at what happened during the past 10 years. If you'd invested $100,000 in the stock market (as measured by the Standard & Poor's 500 Index) you'd have made an inflation-adjusted profit of $31,297 by the end of 2013. If you'd put $100,000 into a house, according to the S&P/Case-Shiller National Home Price Index, you'd have lost $16,519.

Take a longer view, and a house does somewhat better. Over the last 20 years, you'd have an after-inflation annual return of 1.04 percent on a home, but stocks still beat that at 4.6 percent a year. Go back to 1987, when the home index starts, and stocks produce even more -- 5.1 percent -- while a house returns just 0.40 percent, plus dust bunnies.

Take out the other costs of owning a home, however, and even those tiny profits disappear. Unless you paid cash, you'd have shelled out tens of thousands in mortgage interest (even after the tax deduction), plus taxes, insurance and maintenance. And even if you did put down cash, you still have thousands in closing costs, compared with $9.99 to buy stock through the E-trade baby.

A vacation from inflation

All this is not to say that you shouldn't buy a house, just that you shouldn't consider it your best investment. For my family, buying has been cheaper than renting, plus we get the smug satisfaction of owning BOTH a garage-door opener and a sump pump.

In addition, at least a portion of the money we'd spend on rent will come back at a slight gain. Basically, selling a paid-off house means you'll get back whatever your purchase price was plus a tad more, making a home the real estate equivalent of an inflation-protected savings account, but one where you also get to pick your own wallpaper.

(Brian J. O'Connor is an award-winning columnist for The Detroit News. Contact him at or visit