Perhaps I am biased, but I would answer that real esate, in general, is a good investment. Where you plan to invest may be the bigger question you may want to ask. For example, thinking of purchasing in California, or Florida, or Texas? I would take Texas hands down. I say this not simply because I am a Broker in Texas, but because of the number of sales in the state (yes they are showing to be down as well), the average sales price, and the number (or lack thereof as compared to places such as Florida) of foreclosures. One thing for sure, which has been shown time and again, is that real estate will rebound. This industry is cyclical and it will return. I would not be afraid to purchase real estate, but I would be smart about where I purchased. Some areas will clearly give you a better return on your investment than other areas.