You are currently viewing 4 advantages of Real Estate over Stock Market

4 advantages of Real Estate over Stock Market

  • Post author:
  • Post category:Uncategorized

1. Slow and sure appreciation

Since the beginning of time, real estate is poised to appreciate in value since the human race is bound to procreate and ultimately land becomes scarce for the vast majority of the population. Also, it is the law of supply and demand that is controlling. When the supply is low and demand is high prices of real estate appreciates. In a good real estate market, prices can increase from 10% to 20% per year. However, there is a caveat when force majeure intervenes like earthquake, flood, storm, conflagration and war. Some say, the stock market reaps better rewards compared to real estate investing with as much as 50% Return on Investment (ROI) per year. While I do not dispute the fact that on bullish market it can have a high ROI, however, in a bearish market your stock market investment will crash like a kamikaze which one cannot recover (Think 2008 and Asian Financial Crisis). Perforce, it is still better to invest in Real Estate than the Stock Market.

2. Less volatile

Real estate is stable compared to stock market investing. For conservative investors, Real Estate is the best form of investment than parking your extra cash in the bank which will yield around 1% per annum (Ridiculous!). For aggressive investors the stock market is their cup of tea where price can go up and down on a daily basis. As the adage goes, buy real estate and wait!!

3. Can be used as a mortgage

The best form of mortgage is real estate where you can loan at a bank and up to 90% of the amount financed will be securd by Real Estate. On the other hand, the shares of stocks is seldom used as a security for any loan and if it will be approved it can only be 10% to 20% of the amount financed. Truly, the best way to finance your business or any form of loan is thru Real Estate.

4. Secure

Real estate is much more secure than stock market investing because you must have “Title” to Real Estate or the conclusive proof of ownership; you can pass it from generation to generation without any problem as long as you have it. It is way more difficult to defraud since it will be registered at the Register of Deeds and local Assessors Office. On the other hand, stock market investing is done through online brokerage firms and large banks for buying and selling shares of stocks. Today, in this day and age the threat of cyber attack is clear as the day. Hackers can and will breach any form of data and they can do it anywhere in the world without being caught. Therefore, invest in Real Estate more and Stock Market less!!