There are a few people saying the bubble is about to burst on real estate, but you're right, it will probably lead to an even bigger downturn in stocks. The property you buy isn't going to lose value, more than likely, but the interest you're paying on your mortgage is essentially a maintenance coat on your investment. Say you've got 10k right now in that mutual fund. You use that 10k to put a down payment on a 100k house. In ten years you sell that house for 110k. You have your original 10k, plus your 10k in profit, for a grand total of 20k. Now subtract the interest that you've paid on the 90k mortgage, plus all the other costs of ownership in excess of what you were paying for rent and you'll probably see that your original 10k is now much less than if you'd just left it in the fund.