Worst investment ever?

Here's something that may send shivers up your spine if you think prospective homebuyers are sitting on the sidelines in some markets waiting for prices to fall. What are they going to think when Motley Fool tells them they'd be better off putting their money in stocks?

This take on the rent vs. buy debate was originally published May 18, but is getting top billing today in the Personal Finance department at Yahoo! Finance. According to Motley Fool writer Robert Aronen, homes are "The Worst Investment Ever."

One reason, Aronen says, are the high annual expense ratios -- property taxes, maintenance and insurance can add up to 3 percent or more of property value. That compares with less then 1 percent for the best mutual funds.

The bigger problem, Aronen says, is the "big hit" you take when you sell.

"Real estate agents will collect 6 percent of the selling price, while, lawyers, inspectors, title companies, and banks will collect additional fees," he complains. "These fees appear as though they will remain stubbornly fixed for years to come. If you flip properties as though you are actively trading stocks, the only folks getting rich will be real estate agents."

The rent vs. buy analysis can be a complicated one, depending on a prospective buyer's income and tax bracket, geographic location, and the home they're looking at. Should real estate professionals be more involved in this debate? What tools is the industry offering consumers to help them decide whether a home is or is not "The Worst Investment Ever"?

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