Stocks or Real Estate: Which Is Better Option For Healthy Returns?

Stocks or Real Estate: Which Is Better Option For Healthy Returns?

by Ryan

Do you have a fund corpus? Or are you unsure of investing to gain healthy returns? To answer these questions, let me make you aware of the market scenario. People use four markets for the investment of their funds:

  • Buying real estate property;
  • Investing in the stock market;
  • Buying precious elements; and
  • Keep the funds in savings accounts.

Keeping money in the savings account is a good option but only in emergency cases. It is impossible to make money, just by keeping it in savings account. To make sure that your money grows well, you need to invest it very wisely.

When it comes to investing your money, instead of making a combined portfolio with all the possible options, people look for the best choice. They look for the investment option that safeguards their hard earned fortune against risks.

If given a choice of selecting from either real estate or stocks, people are still confused. But you won’t be able to make healthy returns with a conservative frame of mind. You can also contact Angus Reed – Property Developer so as to get the best advice on investment.

To make sure that your money is properly invested, look at the aspects of both the options:

Comparison of Stock Market and Real Estate Market 

  • Control: In real estate market, there is complete control over your investment. You have the independent rights to optimize your wealth like improvements, renting, painting, repairs, and other such petty issues. But the case is different in stock market. You don’t have the right to act on your own.
  • Risk vs. Expected Returns: Whether it is equity market or real estate market, there is always the desire of expected returns. In case of stock and equity market, you can analyze the risk and you can expect the returns as per the past performances. It does not guarantee similar performance in the future.

But the scenario is different in case of real estate market. If you look at the past records of the same, there are maximum chances of growth in real estate investment.

  • Inflation: The regular and periodic increment in the rental rates, housing prices, and land costs makes the real estate market a very safe option. Investments in property market work as a security against inflation.
  • Compounding Growth: If you have borrowed a home loan with a down payment of 20%, your ownership in the property is limited to this extent only. For instance, if the property rate rises by 5%, your percentage increases to 25%. But the bank owns only the percentage of the gain value of your property.. Guess what! Even a 5% increment in the value of your property gives you the health returns of 25%.

Whereas such compound growth is unimaginable in the stock market.

According to the market survey, I have conducted, real estate investment is suitable for people who:

  • are not able to sustain in the volatile markets such as stock market;
  • Believe in long term investment;
  • Take pride in ownership of any real estate; and
  • Believe in the real and physical asset.

Whereas the Equity Market is the best investment option for people who: 

  • Have the ability to take high risks;
  • Can sustain and survive in the volatile market;
  • Don’t have enough capital to invest in the market; and
  • Have the liberty of giving control to more knowledgeable people.

Now when the ball is in your court, you should always make a wise investment portfolio. But make sure not to keep all the eggs in one basket. Rather you would be in need of right balance of stocks and real estate investment in your portfolio.

Before investing in any of the markets, make sure that you carefully analyze and weigh different factors, know your risk factors, and then choose the investment that is suitable for you.

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