Real Estate Investment vs Stock Market Investment
Introduction
- Advantages Of Stock Market Investment
- Returns From Stock Market Investment
- Advantages Of Real Estate Investment
- Returns From Real Estate Investment
- Conclusion
Advantages Of Stock Market Investment
● Stock investment is also a long term investment . But it is not as long as real estate investment.
● We need to find a reliable stock broker, open a demat and trading account, and link it to your bank account . All this can be done online to invest in stocks.
● Exposed to market volatility, but usually generates higher returns over the long term than real estate. However, misleading market trends often make investors make impulsive buying and selling decisions.
● We can exit our stock investments anytime during market hours. We can also liquidate our equity investments partially to meet our needs.
● We can diversify our investments with a nominal amount and also invest in equities and stocks of various companies.
● For real estate investments, we need to get our timing right-timing of its purchases and its sale.
● Invest in one when the market prices are low or on the verge of increasing or show great scope for the same.
● We can sell it when the prices have skyrocketed, enabling us to.
● Enjoy high returns on investment. We also have to wait for the right market conditions, look for a good and genuine buyer and sell it to liquidate our real estate investment.
Returns From Stock Market Investment
● With stock investments, individuals invest towards the ownership of the company. Therefore, when the company makes a profit, it is automatically passed on to the stockholders as well.
● Investors are eligible for dividends on shares.
● Selling them at the right time also generates healthy returns.
Advantages Of Real Estate Investment
● The real estate investment is a long term investment.
● We need to hold the investment till the market price rises to its potential.
● It is time consuming as it requires thorough research for making the right choice, followed by legal paperwork to complete the process.
● Exposed to market risks, but holding it till the market price rise, thereby generating high returns
● We have to wait for the right market conditions,find the best buyer and sell the property to liquidate your investment.
● No option for diversification.
Returns From Real Estate Investment
● Real estate yields cannot usually beat inflation.
● Returns from real estate are primarily decided on the basis of its location.
● Market prices often fluctuate, making it challenging to estimate the returns.
● Real estate investments for the purpose of living in.
● It can not be considered as an investment because it would not generate monetary returns.
● Real estate investment is more expensive than stocks, since it requires a substantial lump sum payment as an initial investment.
● Recommendable for investors who want to invest a substantial amount of capital.
Conclusion
● In Real estate investments, the initial investment itself is heavy, lump sum payment and highly expensive.
● Whereas in Stock market investments, we can do a proper forecast, and then select the best favourable stock price and buy as many shares as possible within our budget.
● In Real estate investments, the process is very time consuming which involves the proper search for the property and completion of legal paperwork for registration.
● Whereas in the Stock market, not much time is required. It can be easily done on Online. The process is also simple and involves 3 steps as below
1. Find a reliable stock broker
2. Open a Demat
3. Link it to your Bank Account
● All this can be done online to invest in stocks within a short time.
● In Real estate investments, selling the property is also a tedious job. We have to wait for the right market conditions and find out the right buyer to sell the property.
● Whereas in the Stock market, we can sell our shares during market hours. There is no need to spend too much time. We can also liquidate our equity investments partially to meet our needs.
● In Real estate investments, there is no option for diversification.
● Whereas in Stock market investments, We can diversify our investments with a nominal amount and also invest in equities and stocks of various companies.
● By doing proper analysis , one can come to the conclusion that the Stock investments are always better than Real estate investments and it is the best option for investment.
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