which is a better investment choice Real estate or Stock Market?

Question

chose one and why

Answer 1

I can not help thinking that a 640 acre corn field in Illinois will be a great investment because of the ethenol deal. Should give you a very healthy return. You can go shares with an Illinois farmer.

Answer 2

Both are good. Choice is yours. The difference is you have to borrow money to get into real estate which places a heavy liability on your financial station in life. Although most are not concerned with this, it is still an obligation that must be fulfilled by you once you sign on the line.

With the stock market, you can also leverage i.e. Forex, but your margin is due at the end of the day. The stock market is a good place to take any amount of money and invest. As with any industry, the success of your investment will depend on how good you do your homework. Individual stocks need two things, value and a catalyst for success. Mutual funds can be great, too.

Both real estate and the stock market are subject to substantial instability. While the stock market could crash heavily in one day, you can sell shares most anytime the market is open. With real estate, getting out of an investment property can take months or sometimes years.

You can also invest in the real estate market through the stock market with what are called REIT's or Real-Estate-Investment-Trusts. It is kind of like a mutual fund for real estate.

I recommend reading some good books before getting started. If you rely to heavily on outside sources to tell you what to buy and when, you are setting yourself up for confusion.

Invest in what you know. If you are familiar with online advertising for example, you might consider looking into these stocks. This will give you an edge when you start trading.

Be unemotional. The most important thing to know in the stock market is when to sell. Buy low, sell high. Easy, right? Well a lot of folks get too wrapped up in news headlines that results in them selling stocks prematurely instead of remembering that they are investing for the long haul.

Be blessed,

Answer 3

I'm going against the consensus here and choosing real estate. Here's why:

1) Leverage - you can buy properties mostly using the bank's money. If you buy a $200,000 with $20,000 and it goes up in value 6% to $212,000, you've made $12,000 - a 60% return. If you invest $20,000 in stock, a 6% increase in value will get you just another $1,200 - one tenth the return. Leverage can get you a lot more bang for the buck. You can leverage stocks, too, using margin accounts, but not nearly to the same extent - and it's a lot riskier.

2) Stocks are a lot more volatile - they can go up or down in value significantly over night, and can even sink to nothing in value. Real estate prices move much more slowly, and a 15-20% downward movement over a period of years is considered a major correction. Stocks can and do drop this much in value in a matter of days.

3) There are major tax benefits for real estate. Even if you have positive cash flow, offsetting depreciation can still reduce your overall taxable income. Realized gains on stocks are going to taxed at 15% or more - no offsetting depreciation, of course.

I've got a lot more arguments in favor of real estate, but these are the main ones. The major downsides of real estate are that it takes a lot more time to manage, and it is not liquid if you need to sell quickly. But given a choice, I'll take real estate any day over stocks.

Answer 4

I like the stock market more. I still think real estate is way over valued. I would look at real estate in a couple of years. If you decide to invest in the stock market, you should see what the best investors are buying and selling at http://www.top10traders.com - this is a free site that lets you create a portfolio of stocks with $100,000 in "play" money. Each day the site ranks the best performing portfolios, so you can see how your picks perform compared to other investors. You can read posts on investing from the best traders, as well as share your own investing ideas. There is a charting feature, so you can see how your portfolio performs compared to the S&P 500. Also, you can create your own "group" so that you can see how you are doing compared to your friends.

Here are this month's best traders:

http://www.top10traders.com/Top10Standings.aspx

Good luck.

Answer 5

It depends, but for 75% of the population the best investment is stocks. That 75% can't afford all the costs associated with real estate.

Real estate is more about preserving wealth than making money. Donald Trump got most of his money by skimming other people's money to buy real estate. So he is more of a real estate agent rather than a property investor. Sure he owns property, but he is just preserving his wealth. The guest writers in the Yahoo business section are doing the same thing about holding more real estate than stocks because they are multi-millionaires.

Answer 6

I prefer Stock Market.

If you know how to hedge your Stock Market Position, it is better to invest in stock market because it is much more liquid than real estate.

When you need the cash just liquidate the stock and you get your cash almost immediately. but for real estate, you cannot just sell it and get cash instantly

Answer 7

id say real estate is probably the best investment.. but if you would need your money to be easily accesible, real estate isnt the best choice