Real EstateI was having a discussion with my investment specialist last week and was surprised when he told me that he advises people not to invest in real estate.Rather put all of your money in Mutual Funds etc.I was pretty surprised this was his advice and felt I should break down what investing in real estate looks like. Keep in mind, I believe in diversifying, but not all in bank product. 
A Discussion With My Investment Specialist
You were saying that people who started 37 years ago with $362000 would have a healthy investment of $3294189. You were referencing this amount due to us taking out a mortgage for an investment this year. You also made a comment that you tell investors not to invest in real estate. But I disagree. 
Now if one did start investing 37 years ago, which would have put me at 17 years of age, I would not have had $362000 all at once (unless I had an inheritance). I'm sure you know that most don't start investing with that amount of money. They start slow, with maybe $200 to $500/month. .And of course, I don't have 37 years left. So my investment strategy must change and be aggressive in plan. 
I did take your scenario over 37 years but started with $500 and added $500/month at a rate of return of 6.15% which would be more realistic for most. It totals $820875.
I researched back 30 years and the average return on the S&P was 6.15%. 
Security of a HOME
If 37 years ago this person bought a house, with a 25 year amm, they would have paid it off in 25 years. 
The average detached home in Calgary was $101,986. 
The mortgage would have been $450 or less at an average 6% per year. 
The increase since that time is +5 fold. 
The home itself would be an average today of $585618. 
Now if this same person decided to invest $50/month over the 25 year of the mortgage, which would total his living and investment ability of $500 per month) then he would have an additional $34954 saved. 
Plus, if this same person started investing $500/month adding to his $34954 after they paid off their home over 25 years, then in the next 17 years (totalling 37 years) they would have saved $273616. This would give them a home for life and money invested totalling $859234. Pretty equal to investing as you suggest, but most need a home to live in and better than renting. 
Another scenario for investing with real estate:
As a young person, buy a home with a secondary suite. 
Sale price $400000
Downpayment 20%
Amm 25 years
Int 3.04%
Payments $1520/month
Property Tax $180
Insurance $90
Total $1790
Rent up - $!300
Rent Down $1200
Total Rent $2500
Cash Flow $710/month
There are no investment out there that can give you a cash flow of $710/month based on a capital investment of $80000. Plus the tenants are paying off your initial investment. There are many other ways to invest in real estate, but for ease of getting my point across, real estate IS a good investment when you have the right people giving you expert advice.