I'm talking about properties you buy and rent out, properties that carry themselves meaning the rent covers all your expenses. THANKS.
2007-09-16 16:42:35 · 5 answers · asked by Anonymous in Business & Finance ➔ Investing
It really boils down to your level of passion for each option. To be good at either it takes a lot of studying and education on your part - that's why you need to be passionate about it because it's going to take a lot of your time.
For what it's worth I'll give you my experience. About 2 years ago I had a sizable amount of money to invest. I looked at hard at investing in rental properties. After a lot of due diligence I decided against it. My goal was to make a 8% - 10% return each year. Everyone you deal with takes a small cut out of your profit: agents, management companies, insurance companies, mortage brokers.., Where I live insurance is out of control and property taxes increase double digits every year. Bottom line for me: too difficult to make decent money and lots of headaches.
If you choose the real estate path borrow very sparingly. Most real estate "guru's" I know have lots a properties but they are over extended in their mortgages and have very little cash on hand to live their daily lives.
I've done well with some strategic stock strategies - although that takes a lot of time studying as well. One big advantage about stock is that you can always get your money in or out of the market with the click of a mouse.
2007-09-17 01:56:16 · answer #1 · answered by John W 3 · 0⤊ 0⤋
Real estate is the only true investment that will hold it's true value regardless of inflation.
With that being said, it all boils down to do you want to work for your money, or have your money work for you?
Renting property can make you money, but also takes you time to manage. Investing in the market does not require nearly as much time.
Do you have the money to invest in the market (does not mean take a loan out to do such), or would you rather 'see' your investment?
2007-09-16 17:14:05 · answer #2 · answered by financial advisor 1 · 0⤊ 0⤋
Invest in the Stock market ONLY if you can afford to lose the money (There is no guarantee here) Real estate is pretty safe as long as you don't overpay market prices. Get a GIC at a bank oran RRSP and save on taxes. Something with no risk
2016-05-21 06:52:12 · answer #3 · answered by ? 3 · 0⤊ 0⤋
The answer to your question depends on many personal factors. For example, you need to ask yourself when you will need the money?
Real Estate is an illiquid investment, if you need your funds quickly it is almost impossible to get at it in the short term. Whereas stocks are liquid investments. You may sell them on the open market and have your money in 3 days. Obviously you are subject to market risk.
Diversify yourself in both markets and you have covered all the bases.
2007-09-17 03:03:06 · answer #4 · answered by Christiane 3 · 0⤊ 0⤋
Diversification. Asset Allocation.
So the real answer is: BOTH.
Real Estate is much more time consuming and can be more prone to problems. But both have a place in a portfolio.
2007-09-16 17:06:07 · answer #5 · answered by Common Sense 7 · 1⤊ 0⤋