[kemitche]

An important thing to consider is not just average return, but risk factors, and worst case scenarios.

If you buy a home instead of investing, you've got a locked in, controlled rate for your housing expenses. (Yes, there's some variability with property tax and insurance). In difficult times, you can still plan very carefully around your housing costs and wait for better times.

If you rent and invest, your housing costs can be highly variable and uncontrollable over time. Your investments may not cover increases in housing costs.

A critical factor is that housing is more or less a _required_ cost of existence - just like feeding oneself. It is not something where one can necessarily "invest in other areas" instead. There are extreme cases (living out of an RV or in a tent on the side of the road), but for the most part those extremes are not representative of how someone wants to live. One can only downsize so much, and downsizing your housing investment comes with very real changes to quality of life (storage space, commute time, access to grocery stores, etc).

[joncrocks]

And are you considering the risk factors and worst case scenarios when it comes to housing?

Housing is not as liquid, and prices can also go down as well as up. Often there are large transaction costs associated with buying/selling property.

What if an event happens that is not covered by insurance? Subsistence, large-scale repairs required etc. Changes in housing regulations c.f. the fallout from Grenfell in the UK.

There are risks in both, and risks from housing can also be large. The leverage offered by banks works in your favour in good times but can work against you in bad.