(Bloomberg News) Victoria Pauli signed a one-year lease last week to stay in her rental home in Fair Oaks, California. She had considered buying in the area, where property prices have slumped 57% since a 2005 peak.

In the end, she decided it wasn't worth it.

"I know people who have watched their home values get cut in half, and I know people who are losing their homes," said Pauli, 31, who works as a property manager for a real estate company. "It's part of the American dream to want to own your own home, and I used to feel that way, but now I tell myself: Be careful what you wish for."

The most affordable real estate in a generation is failing to lure buyers as Americans like Pauli sour on the idea of home ownership. At the end of 2010, the fourth year of the housing collapse, the share of people who said a home was a safe investment dropped to 64% from 70% in the first quarter. The December figure was the lowest in a survey that goes back to 2003, when it was 83%.

"The magnitude of the housing crash caused permanent changes in the way some people view home ownership," said Michael Lea, a finance professor at San Diego State University. "Even as the economy improves, there are some who will never buy a home because their confidence in real estate is gone."

Worse Than Depression

Historically, homes have been a safer investment than equities. During 2008, the worst year of the housing crisis, the median U.S. home price declined 15%, compared with a more than 38% plunge in the Standard & Poor's 500 Index.

Americans stay in their homes for a median of eight years, according to the National Association of Realtors in Chicago. Someone who bought a home in 2002 and sold in 2010 saw a 4.8% increase in value, based on the annualized median price measured by the group. The average annual gain in the past 20 years was 4.2%.

Falling prices have made real estate the best buy in at least four decades. Housing affordability reached a record in December, according to National Association of Realtors data that go back to 1970. The group bases its gauge on property prices, mortgage rates and the median U.S. income.

The median U.S. home price tumbled 32% from a 2006 peak to a nine-year low in February, data from the Realtors show. The retreat surpassed the 27% drop seen in the first five years of the Great Depression, according to Stan Humphries, chief economist of Zillow Inc., a Seattle-based real estate information company.