REAL ESTATE VS STOCK
Which is a better investment option either real estate or stock? This question is more alike to asking someone whether vanilla or chocolate is superior. Because there is no specific answer for this query, it totally depends down to one’s personality, preferences and style. It also comes down to the individual investment specifics.
AN OVERVIEW OVER REAL ESTATE VS STOCK:
Both are profitable, having pros and cons and there are several aspects which make them unique investments in their own way. To choose any one of them it’s better to first understand very well about them.
ABOUT REAL ESTATE
For about many years this investment has generated long-term consistent profit and treasuring for millions of people but it depends on your real estate location once this factor chosen perfectly you can enjoy sizeable returns on your investment. There are two categories of real estate one is commercial and other is residential. Making money in real estate isn’t a hard and fast investment. People choose their feasible investment route, they either look for raw properties, overhaul them and then selling them at a higher market value for their profit. Or some look for rented properties to generate a consistent income.
Buying a shares of stock means you are buying a piece of company. Whatever that company manufactures you are only limited to a cut of any profit for every share you own. With a stock
you own an ownership in a company. You will get profit when times are good else during economic challenges and dropping time you may face declining of funds because of the lessen earning in a company. As compared to real estate, being balanced in many areas of stock can help build your net worth at a much greater rate.
PROS AND CONS OF REAL ESTATE VS STOCK
Let’s have a look on pros and cons of each type of investment.
REAL ESTATE INVESTMENT
- With real estate it is easier to stay away from fraud.
- Real estate is cash generating for e.g. rental houses, where tenant sends you cheque every month, after expenses deduction you keep the difference as profit.
- Through stock share you can own a part of a business without any work to do.
- Your share price and dividend amount both grow if company pays to dividends of your own shares.
REAL ESTATE INVESTMENT
- It requires more work in investment than stocks.
- If your property is not occupied it can cost you money out of pocket.
- During decline period of company, stocks can be very volatile.
- Price of stock fluctuate in a very short run.