Not in the long term. But you can't always say the same from a certain stock. Also playing "waiting-game" always wins in the land market.
Only if you can afford to wait that long. Real, inflation-adjusted land prices may easily be higher today in many parts of the US and UK than they will be again within my lifetime.
When prices do a random walk, if you can wait long enough you can recoup any loss of book value. That's just another way of stating the Gambler's Ruin: If you have the (sufficiently) bigger bank, you can't lose unless the game is systemically tilted against you.
But very, very few people in the real world can afford to wait for arbitrarily long lengths of time. As Keynes famously said, "the market can stay irrational longer than you can stay solvent." In other words, even when there is a bias in your favour, you may not always be able to wait long enough to make a profit. Nevermind the case where prices are a random walk.
- Jake If you only spend 20 minutes of the rest of your life on economics, go spend them here.
Real land prices (land values) can only be higher today than tomorrow, if productivity drops, infrastructure gets worse and/or population declines. Market price naturally changes. If you can afford to put money in the bank, you can afford to sit on your land assets. There is only usually just some 1% property tax. Already the average growth in productivity covers that "risk". The problem with Keynes is that he doesn't make the difference between "capital" and "land", even these are very different in nature.
And in fact, housing has, in the US and UK, been grossly overvalued. And that bubble just popped. So prices will go down, and likely stay down for quite a while.
