Were We Oversold On The American Dream Of Home Ownership?

A recent Wall Street Journal article gave an example of the dramatic difference a disciplined investor would have experience if he would have invested in the stock market in 1980 instead of buying a home:

"In 1980 an investor considered buying a $99,550 home that by 2010 would have increased in value by an average of 3.6 percent per year to $296,820.  If that investor would have put his 20 percent down payment of $19,910 and the normal homeownership expenses (above the cost of renting) over the years into the Dow Jones Industrial Index instead, his portfolio in 2010 could have been valued at $1,800,016.  To put it plainly, the stocks would have been worth more than the house by $1,503,196."